Zynga Profits Down
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Zynga – the leader among social game makers – is facing some problems as of late. Well, actually, the problems started a good while ago.
You might recognize Zynga for their games like FarmVille or CityVille. Every day millions of people have a good time interacting with them in a virtual environment. However, the all time high of Zynga is probably long gone as the company’s Facebook user base is on the decline.
This has been noticed by an analyst with Cowen & Co., Doug Creutz, who said: “While we do think that initiatives like Zynga.com and online gambling have the potential to drive long-term upside, that view is balanced off by our belief that Zynga’s core Facebook game business is likely in decline.”
Zynga’s per-share income is down 45% year over year (Q1). The results for Q2 are expected to be around 17% worse than one year before. In the end, the situation is improving a bit, but there’s still nothing to be happy about.
The fact that Zynga is in trouble is very apparent when we take a look at their current shares value. Last Tuesday they were near 4.95, in comparison to the all time high of 15.91 (March 2).
What Does This Mean for Affiliates?
Zynga is the leader in its niche. If they’re in trouble, this reflects the overall situation in the niche itself. Social gaming was a big hit a couple of years ago, and a big number of people are still enjoying it. But the market now is a lot more stabilized with less chance of any new game/company becoming ultra popular in a short period of time.
The initial craze in social gaming is gone, now it’s time to do business in a more planned-out and thought-through way. Affiliate businesses included.