Zynga, the social-game maker that held an initial public offering last year, is cutting 5 percent of staff, shutting offices and ending more than a dozen titles to compensate for slowing sales growth.
San Francisco-based Zynga is closing a studio in Boston, trimming staff in Austin, Texas, and proposing the closure of studios in Japan and the United Kingdom, chief executive Mark Pincus wrote in a memo obtained by Bloomberg. The cuts affect about 142 of the 2,846 workers Zynga had at the end of 2011.
Zynga has fallen 78 percent since the December IPO on disappointing demand for its games on Facebook and a failure to produce runaway hits for mobile devices. Trimming staff may help the company do a better job focusing on mobile games, said Colin Sebastian, an analyst at Robert W. Baird & Co.
“As much as head-count reductions are painful, I think it’s a necessary alignment of their resources,” said Sebastian, who has a neutral rating on Zynga. “They were overstaffed in core social gaming. There needs to be a more aggressive transition into mobile games.”
Shares of Zynga on Tuesday fell 5.2 percent to close at $2.20.
