Zynga to cut 18% of workforce
Social video game company Zynga Inc. on Monday said it will cut 18% of its staff, or about 520 employees.
The struggling maker of games such as “FarmVille” and “Words With Friends” is making the cuts as part of an effort to reduce costs by $70 million to $80 million.
The layoffs will be complete by August. The company will also close some of its offices.
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Zynga has struggled to repeat the success of its early games as many consumers switch to playing on mobile devices.
“None of us ever expected to face a day like today, especially when so much of our culture has been about growth,” said Zynga Chief Executive Mark Pincus in a letter to employees also posted on the company’s blog. “But I think we all know this is necessary to move forward.”
The company also reduced its outlook for the second fiscal quarter. It now expects its net loss to be in the range of $39 million to $28.5 million.
Shares of the San Francisco company slid nearly 12% to $2.99 at the close of trading in New York.
The shares are trading about 70% down from the company’s 2010 initial public offering price of $10.
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