Social casino titles continue to drive Zynga’s bottom line but the company continues to shed users like there’s no tomorrow.
In the three months ending June 30, social gamers Zynga reported a net loss of $4.4m as revenue slipped 9% to $181.7m. The net loss is a step up from the nearly $27m Zynga lost in Q2 2015 and the $62.5m it lost in Q2 2014, so yay progress. Much of this quarter’s improvement came from better cost control and decreased marketing spend.
Online game revenue fell 16% year-on-year to $136m, while advertising and other revenue rose 22% to $46m. Total revenue exceeded Zynga’s earlier forecast of $170m to $180m, but investors were unmoved, pushing the stock down 10% in after-hours trading.
Bookings, the in-game sale of virtual goods, totaled $174.6m in Q2, flat year-on-year but down 4% from Q1. Mobile bookings accounted for $137m of the total, up 19% year-on-year but down 2% from Q1. Zynga’s once dominant web bookings fell from 34% of the total last year to just 21% this time around.
The venerable Zynga Poker continues to shine nine years after its launch, accounting for 19% of game revenue, up one point year-on-year. Wizard of Oz Slots’ share of the pie rose five points to 15%, while the exclamation point seems to have gone out of Hit It Rich! Slots, which saw its share fall five points to 11%.
All told, Zynga’s slots titles accounted for 32% of online game revenue and 39% of online bookings revenue, while Zynga Poker scored 19% and 20%, respectively.
As for non-casino stars, Farmville 2’s share of game revenue slipped six points to 12%, while the new Empire & Allies adventure title scored a 10% share. The company says its new CSR2 racing title – a Natural Motion title that launched during the quarter – has started well.
Regardless, Zynga is still having difficulty bolting the doors. Average daily active user (DAU) ranks fell 15% from Q2 2015, while monthly actives fell more than one-quarter. On the plus side, Zynga is getting better at monetizing its remaining users, as average daily bookings per average DAU rose 17% to 10.7¢ (respectable, but nowhere near social casino market leader Playtika’s 40¢).