Zynga amends IPO to show falling profits
Rising costs and a dip in revenue growth could delay IPO further
Zynga has issued another amendment to its IPO filing that shows a sharp decrease in the company's profits.
Net income for the second quarter fell to $1.4 million; a 90 per cent year-on-year drop from $14 million, and an even steeper decline from $16.8 million in the first quarter.
Revenue growth has also slowed, with the $279.1 million in revenue for the three months ending June 30 representing a 115 per cent year-on-year increase - versus year-on-year increases of 141 per cent and 251 per cent in the two prior quarters.
However, Zynga revealed that total costs and expenses for the second quarter nearly equalled its total revenue, increasing $149 million year-on-year.
Investment in R&D almost tripled in the first half of the year. This is attributed to a significant increase in staff - from 1483 at the end of 2010, to 2451 at the end of June.
The company's daily active users declined in the second quarter, from 62 million at the end of March to 59 million at the end of June.
Zynga has made a number of high profile hires this year, as well as several studio acquisitions. Zynga has delayed its IPO since filing it in July due to tough market conditions.