DELIVERS RESULTS ABOVE GUIDANCE RANGE WITH
$167.4M IN BOOKINGS AND $2.1M IN ADJUSTED EBITDA
ANNOUNCES $100M COST REDUCTION PROGRAM
LAUNCHES FIRST MOBILE ACTION STRATEGY GAME,
EMPIRES & ALLIES, WORLDWIDE
Zynga Inc. (Nasdaq:ZNGA), a leading social game developer, today
announced financial results for the first quarter ended March 31,
2015.
"In Q1, we delivered results above our guidance generating $167
million in bookings and Adjusted EBITDA of $2 million. Our Q1
results reflect the progress we have made in our transition to
mobile which now represents 63% of total bookings – up 84% year
over year," said Mark Pincus, CEO of Zynga. "Zynga remains focused
on our mission of connecting the world through games, which is even
more relevant and possible today. Our execution is focused in three
areas – our products, where we're backing proven teams against the
most valuable game categories; our people, to foster creative
entrepreneurs; and our plan in order to fund our future with focus
and simplicity."
"I'm proud of Mark Skaggs and team for launching Empires &
Allies – a great new Action Strategy game with encouraging early
player feedback," continued Pincus. "In terms of our overall
products, we have narrowed our focus to five categories: Action
Strategy, Social Casino, Invest & Express, Casual and Racing.
We now expect to launch between 6 to 8 new mobile games in 2015
with a continued investment in our future pipeline for 2016 and
beyond."
Business and Audience Highlights
- Outperformed high end of Q1'15 outlook with bookings of $167.4
million, Adjusted EBITDA of $2.1 million and Non-GAAP net loss of
$6.7 million in the first quarter of 2015.
- Continued to make progress in our transition to mobile, with
mobile bookings now 63% of total bookings in the first quarter of
2015 – up 84% year over year.
- Grew average daily bookings per average DAU (ABPU) 18% year
over year.
- Drove mobile audience growth, with first quarter mobile daily
users up 18% year over year and 9% sequentially and mobile monthly
audience up 29% year over year and 9% sequentially.
- Ongoing efforts to grow and sustain Zynga's core franchises –
FarmVille, Zynga Casino and Words With Friends – resulted in 28%
aggregate growth year over year in terms of first quarter bookings
across the franchises.
- Zynga Casino franchise delivered bookings growth of 55% year
over year and 14% sequentially.
- In the first quarter 2015, we entered into the mobile Action
Strategy and mobile Match 3 categories with the geo-lock launches
of Dawn of Titans, Empires & Allies and FarmVille: Harvest
Swap.
Financial
Highlights (in thousands, except per share data) |
|
|
|
|
Quarter
ended |
|
March 31, 2015 |
March 31, 2014 |
GAAP Results |
|
|
Revenue |
$ 183,293 |
$ 168,020 |
Net income (loss) |
$ (46,496) |
$ (61,183) |
Diluted net income (loss) per share |
$ (0.05) |
$ (0.07) |
|
|
|
Non-GAAP Results |
|
|
Bookings |
$ 167,410 |
$ 161,358 |
Adjusted EBITDA |
$ 2,093 |
$ 13,846 |
Non-GAAP net income (loss) |
$ (6,713) |
$ (6,258) |
Non-GAAP net income (loss) per share |
$ (0.01) |
$ (0.01) |
Cost Reduction Plan
Today, Zynga announced a cost reduction plan expected to
generate pre-tax savings of approximately $100 million, excluding
an estimated $18 million to $22 million pre-tax restructuring
charge in the second quarter of 2015. As part of the plan, Zynga
expects to complete a reduction of approximately 18% of our current
workforce across its studios, including contractors, and implement
additional cost reduction measures, including lowering costs and
eliminating spend on outside and centralized services. Zynga
expects the workforce reduction to be complete in the fourth
quarter of this year and generate approximately $45 million in
annualized savings. Zynga expects the reduction in centralized
services costs and spend to be complete by the third quarter of
2016 and generate approximately $55 million in annualized savings.
All savings estimates exclude restructuring charges.
"For our people, we need to create an empowered, entrepreneurial
culture that fosters more creativity and innovation. Over the years
we've seen that tighter, more nimble teams can drive faster
innovation and deliver more player value," said Pincus. "As a
result, today we announced a cost reduction program to focus,
simplify and align us against our most promising opportunities. We
expect these cost reductions to generate $100 million in annualized
savings. We are reducing our workforce by 364 people or
approximately 18%, decreasing our outside services and reducing our
central functions. This was a hard but necessary decision and I
believe this plan puts us in the best long term position for
success."
Launches First Mobile Action Strategy Game, Empires
& Allies, Worldwide on the App Store and on Google
Play
On May 5, 2015, Zynga launched Empires & Allies, its first
mobile Action Strategy game, to global audiences. Empires &
Allies is a new, modern military strategy game where players design
their perfect army and deploy the weapons of modern war in a
never-ending battle to save the world. Developed by a seasoned team
of developers, and led by real-time strategy (RTS) and social games
pioneer Mark Skaggs, Empires & Allies gives players new levels
of strategic choice and control in every battle.
First Quarter Operational Metrics
The company tracks operating metrics using internal systems
which rely on internal company data and third party data. In
the first quarter of 2015, the company modified its calculation to
take into account our business's transition to mobile and updates
to our operating metrics which utilize additional third party data
to help us identify whether a player logged in under two or more
accounts is the same individual. As a result of these changes,
we revised the definitions for DAUs, MAUs, MUUs, and MUPs in the
first quarter of 2015. We rely on the veracity of data provided by
individuals and reported by third parties to calculate our metrics
and reduce duplication of data. For comparative purposes, these key
operating metrics have been revised for the first quarter of 2014
and fourth quarter of 2014 to reflect the updated
definitions. The following comparisons are based on the
revised numbers for 2014. Please refer to our first quarter of
2015 investor presentation available at http://investor.zynga.com
for a full explanation of the changes and the comparison of the
revised and as reported numbers for 2014.
- Average daily bookings per average DAU (ABPU) increased from
$0.064 in the first quarter of 2014 to $0.076 in the first quarter
of 2015, up 18% year over year. On a consecutive quarter basis,
ABPU was down 10% from $0.084 in the fourth quarter of 2014.
- Monthly unique payers (MUPs) in the first quarter of 2015 were
1.1 million, compared to 1.3 million in the first quarter of 2014.
On a consecutive quarter basis, MUPs were up 8% from 1.0 million in
the fourth quarter of 2014.
- Daily active users (DAUs) in the first quarter of 2015 were 25
million, compared to 28 million in the first quarter of 2014. On a
consecutive quarter basis, DAUs were up 4% from 24 million in the
fourth quarter of 2014. Web DAUs and Mobile DAUs were 6 million and
19 million in the first quarter of 2015, respectively.
- Monthly active users (MAUs) in the first quarter of 2015 were
100 million, compared to 119 million in the first quarter of 2014.
On a consecutive quarter basis, MAUs were up 3% from 98 million in
the fourth quarter of 2014. Web MAUs and Mobile MAUs were 24
million and 76 million in the first quarter of 2015, respectively.
- Monthly unique users (MUUs) in the first quarter of 2015 were
73 million, compared to 79 million in the first quarter of 2014. On
a consecutive quarter basis, MUUs were up 10% from 66 million in
the fourth quarter of 2014.
First Quarter 2015 Financial Summary
- Revenue: Revenue was $183 million for the
first quarter of 2015, an increase of 9% compared to the first
quarter of 2014 and a decrease of 5% compared to the fourth quarter
of 2014. Online game revenue was $148 million, an increase of 12%
compared to the first quarter of 2014 and an increase of 10%
compared to the fourth quarter of 2014. Advertising and other
revenue was $35 million, a decrease of 1% compared to the first
quarter of 2014 and a decrease of 39% compared to the fourth
quarter of 2014. FarmVille 2, Zynga Poker, FarmVille 2: Country
Escape and Hit it Rich! Slots accounted for 20%, 19%, 16% and 15%
of online game revenue, respectively, for the first quarter of 2015
compared to FarmVille 2, Zynga Poker, and Hit it Rich! Slots
accounted for 23%, 20%, and 16%, respectively, for the fourth
quarter of 2014.
- Bookings: Bookings were $167 million for the
first quarter of 2015, an increase of 4% compared to the first
quarter of 2014 and a decrease of 8% compared to the fourth quarter
of 2014.
- Net loss: Net loss was $46 million for the
first quarter of 2015, compared to net loss of $61 million for the
first quarter of 2014 and compared to net loss of $45 million for
the fourth quarter of 2014.
- Adjusted EBITDA: Adjusted EBITDA was $2
million for the first quarter of 2015 compared to $14 million for
the first quarter of 2014 and $9 million in the fourth quarter of
2014.
- Non-GAAP net loss: Non-GAAP net loss was $7
million for the first quarter of 2015, compared to non-GAAP net
loss of $6 million in the first quarter of 2014 and non-GAAP net
loss of $2 million in the fourth quarter of 2014.
- Net loss per share: Diluted net loss per share
was $0.05 for the first quarter of 2015 compared to a diluted net
loss per share of $0.07 for the first quarter of 2014 and diluted
net loss per share of $0.05 for the fourth quarter of 2014.
- Non-GAAP loss per share: Non-GAAP net loss per
share was $0.01 for the first quarter of 2015 compared to a
non-GAAP net loss per share of $0.01 for the first quarter of 2014
and a non-GAAP net loss per share of $0.00 for the fourth quarter
of 2014.
- Cash and cash flow: As of March 31, 2015,
cash, cash equivalents and marketable securities were approximately
$1.10 billion, compared to $1.15 billion as of December 31, 2014.
Cash flow from operations was ($47) million for the first quarter
of 2015, compared to ($24) million for the first quarter of 2014
and $4 million for the fourth quarter of 2014. Free cash flow was
($49) million for the first quarter of 2015 compared to ($25)
million for the first quarter of 2014 and $2 million for the fourth
quarter of 2014.
Second Quarter Outlook
Zynga's outlook for the second quarter of 2015 is as
follows:
- Revenue is projected to be in the range of $175 million to $190
million
- Net loss is projected to be in the range of $54 million to $50
million
- Net loss per share is projected to be $0.06 based on a share
count projected to be approximately 905 million shares
- Bookings are projected to be in the range of $145 million to
$160 million
- Adjusted EBITDA is projected to be in the range of ($20)
million to ($10) million
- Non-GAAP net loss per share is projected to be $0.02 based on a
share count projected to be approximately 905 million shares
Conference Call Details
Zynga will host a conference call today, May 6, 2015, at 2:00 pm
PDT (5:00 pm EDT) to discuss financial results. A live webcast of
the conference call and supplemental slides will be accessible from
the Investor Relations page of the company's website at
http://investor.zynga.com and a replay will be archived and
accessible at the same website after the call.
About Zynga Inc.
Zynga Inc. is a leading developer of the world's most popular
social games that are played by more than 100 million monthly
consumers. The company has created evergreen franchises such as
FarmVille, Zynga Casino and Words With Friends. Zynga's
NaturalMotion, an Oxford-based mobile game and technology
developer, is the creator of hit mobile games in popular
entertainment categories, including CSR Racing, CSR Classics and
Clumsy Ninja. Zynga games have been played by more than 1 billion
people around the world and are available on a number of global
platforms including Apple iOS, Google Android, Facebook and
Zynga.com. The company is headquartered in San Francisco,
California. Learn more about Zynga at http://blog.zynga.com or
follow us on Twitter and Facebook.
The Zynga Inc. logo is available at
http://www.globenewswire.com/newsroom/prs/?pkgid=11743
Key Operating Metrics
We manage our business by tracking several operating metrics:
"DAUs," which measure daily active users of our games, "MAUs,"
which measure monthly active users of our games, "MUUs," which
measure monthly unique users of our games, "MUPs," which measure
monthly unique payers in our games, and "ABPU," which measures our
average daily bookings per average DAU, each of which is recorded
by our internal analytics systems. The numbers for these operating
metrics are calculated using internal company data based on
tracking of user account activity. We also use third party network
logins to help us track whether a player logged under two or more
different user accounts is the same individual. We believe that the
numbers are reasonable estimates of our user base for the
applicable period of measurement; however, factors relating to user
activity and systems may impact these numbers.
Please refer to our first quarter of 2015 investor presentation
available at http://investor.zynga.com for our updated definitions
of "DAU," "MAU," "MUU," "MUP" and "ABPU."
MUUs and MUPs in this press release exclude MUUs and MUPs from
NaturalMotion legacy games (CSR Racing, CSR Classics and Clumsy
Ninja) as our systems are unable to distinguish whether a player of
a NaturalMotion legacy game is also a player of a Zynga game. We
exclude payers of NaturalMotion legacy games to avoid potential
double counting of MUUs and MUPs.
We acquired NaturalMotion in February 2014. As a result, the
financial information presented in this press release for January
2014 and a portion of February 2014 does not reflect any
contribution from NaturalMotion.
Forward-Looking Statements
This press release contains forward-looking statements relating
to, among other things, our outlook for the second quarter of 2015
revenue, net loss, diluted net loss per share, weighted average
diluted share count, bookings, Adjusted EBITDA, non-GAAP net income
(loss) per share and non-GAAP weighted average diluted share count;
certain other financial items necessary for GAAP to Non-GAAP
reconciliation; our future operational plans, use of cash,
strategies and prospects; our cost structure and cost reduction
plan and the expected cost savings and charges from this plan,
including our reduction in workforce, cost reduction measures and
plan to lower discretionary spend; our ability to accelerate
execution, drive profitability and nurture creativity and
innovation while reducing costs and lowering discretionary spend;
the breadth and depth of our game slate for 2015 and the success of
this slate, including the success of the recently launched Empires
& Allies; our planned launch of mobile first games and new
features for existing games; our ability to grow our mobile
bookings; our ability to execute against our strategy and deliver
long term value for our shareholders, employees and players; our
ability to intensify and narrow our focus and leverage our core
strengths and focus on the highest potential opportunities; the
strength of our balance sheet and our ability to effectively manage
our cost structure and investments; our focus on five primary game
categories, backing proven teams to develop or expand our offerings
in these categories, the timely launch of games in these categories
and the success of these games; our ability to monetize these
games; our ability to improve our execution against audience growth
and product quality; our ability to effectively market our games;
our ability to sustain and expand key games to sustain and grow
audience, bookings and engagement, including our top
franchises—Zynga Casino, Words, Farm and Racing; our ability to
build on our social legacy in both our web games and our new mobile
games and to build a player network across mobile games; our
ability to accurately forecast our upcoming game launches and
bookings and revenue related to upcoming game launches and the
performance of our existing games; our continued investment in our
future pipeline, and market opportunity in the social gaming
market, including the mobile market and advertising market and our
ability to capitalize on and contribute to this market opportunity.
Forward-looking statements often include words such as "outlook,"
"projected," "intends," "will," "anticipate," "believe," "target,"
"expect," and statements in the future tense are generally
forward-looking. The achievement or success of the matters covered
by such forward-looking statements involves significant risks,
uncertainties, and assumptions. Our actual results could differ
materially from those predicted or implied and reported results
should not be considered as an indication of our future
performance. Factors that could cause or contribute to such
differences include, but are not limited to, the ability of key
games, including our franchise games to sustain or grow audience,
bookings and engagement, our relationship with Facebook or changes
in the Facebook platform, our relationship and/or agreements with
Apple, Google and Android platform providers and/or changes in the
Android or iOS platforms, our relationship and/or agreements with
key licensing partners, delays or challenges in implementing
cost-cutting activities and our ability to control and reduce
expenses and discretionary spend, our ability to retain key
employees and retain and attract new talent and our ability to work
as a team to execute against our strategy, our use of working
capital in general, attrition and declines in our existing games,
our ability to launch new games and features in a timely manner and
monetize these games and features effectively on the web and on
mobile, including planned features for our existing games, planned
launches from NaturalMotion, planned launches from our franchises
and planned launches in the five content categories where we are
focused, the effectiveness of our marketing initiatives and ability
to obtain game featuring from partners, seasonal changes in
advertising rates, our ability to run successful in game
advertising campaigns, our exposure to illegitimate credit card
activity and other security risks, sales or purchases of virtual
goods used in Zynga Poker or our other games through unauthorized
or fraudulent third-party websites, our ability to anticipate and
address technical challenges that may arise, our ability to protect
our players' information and adequately address privacy concerns,
competition, changing interests of players, intellectual property
disputes or other litigation, asset impairment charges,
acquisitions by us, and changes in corporate strategy or
management.
More information about factors that could affect our operating
results is included under the captions "Risk Factors" and
"Management's Discussion and Analysis of Financial Condition and
Results of Operations" in our Annual Report on Form 10-K for the
year ended December 31, 2014 and, when filed, our Quarterly
Report on Form 10-Q for the three months ended March 31, 2015,
copies of which may be obtained by visiting our Investor Relations
web site at http://investor.zynga.com or the SEC's web site at
http://www.sec.gov. Undue reliance should not be placed on the
forward-looking statements in this release, which will be based on
information available to us on the date hereof. There is no
guarantee that the circumstances described in our forward-looking
statements will occur. We assume no obligation to update such
statements. The results we report in our Quarterly Report on
Form 10-Q for the quarter ended March 31, 2015 could differ from
the preliminary results we have announced in this press
release.
Non-GAAP Financial Measures
We have provided in this release non-GAAP financial information
including Bookings, Adjusted EBITDA, free cash flow, non-GAAP net
loss and non-GAAP net loss per share, as a supplement to the
consolidated financial statements, which are prepared in accordance
with generally accepted accounting principles ("GAAP"). Management
uses these non-GAAP financial measures internally in analyzing our
financial results to assess operational performance and liquidity.
The presentation of this financial information is not intended to
be considered in isolation or as a substitute for the financial
information prepared in accordance with GAAP. We believe that both
management and investors benefit from referring to these non-GAAP
financial measures in assessing our performance and when planning,
forecasting and analyzing future periods. We believe these non-GAAP
financial measures are useful to investors because they allow for
greater transparency with respect to key financial metrics we use
in making operating decisions and because our investors and
analysts use them to help assess the health of our business. We
have provided reconciliations between our historical and second
quarter 2015 outlook for non-GAAP financial measures to the most
directly comparable GAAP financial measures.
Some limitations of Bookings, Adjusted EBITDA, non-GAAP net
loss, non-GAAP loss per share, and free cash flow:
- Adjusted EBITDA and non-GAAP net loss do not include the impact
of stock-based expense, asset impairment charges,
acquisition-related transaction expenses, contingent consideration
fair value adjustments and restructuring expense;
- Bookings, Adjusted EBITDA and non-GAAP net loss do not reflect
that we defer and recognize online game revenue and revenue from
certain advertising transactions over the estimated average life of
virtual goods or as virtual goods are consumed;
- Adjusted EBITDA does not reflect income tax expense;
- Adjusted EBITDA does not include other income and expense,
which includes foreign exchange gains and losses and interest
income;
- Adjusted EBITDA excludes both depreciation and amortization of
intangible assets, while non-GAAP net loss excludes amortization of
intangible assets from acquisitions. Although depreciation and
amortization are non-cash charges, the assets being depreciated and
amortized may have to be replaced in the future;
- Adjusted EBITDA and non-GAAP net loss do not include gains and
losses associated with significant legal settlements;
- Non-GAAP net loss per share gives effect to all dilutive awards
based on the treasury stock method that were excluded from the GAAP
diluted earnings per share calculation in periods when non-GAAP net
income (loss) is positive and GAAP net income (loss) is
negative;
- Free cash flow is derived from net cash provided by operating
activities less cash spent on capital expenditures and
acquisitions, and removing the excess income tax benefits or costs
associated with stock-based awards; and
- Other companies, including companies in our industry, may
calculate bookings, Adjusted EBITDA, non-GAAP net income (loss),
non-GAAP net income (loss) per share and free cash flow differently
or not at all, which will reduce their usefulness as a comparative
measure.
Because of these limitations, you should consider bookings,
Adjusted EBITDA, non-GAAP net income (loss), non-GAAP net income
(loss) per share, and free cash flow, along with other financial
performance measures, including revenue, net income (loss), diluted
net loss per share, cash flow from operations and GAAP operating
margin and our other financial results presented in accordance with
GAAP. See the GAAP to non-GAAP reconciliations below for further
details.
|
|
ZYNGA INC.
CONSOLIDATED BALANCE SHEETS (In thousands,
unaudited) |
|
|
|
|
March 31, |
December 31, |
|
2015 |
2014 |
Assets |
|
|
Current assets: |
|
|
Cash and cash equivalents |
$ 217,455 |
$ 131,303 |
Marketable securities |
732,985 |
785,221 |
Accounts receivable |
79,521 |
89,611 |
Income tax receivable |
4,502 |
3,304 |
Deferred tax assets |
924 |
2,765 |
Restricted cash |
48,098 |
48,047 |
Other current assets |
28,800 |
22,688 |
Total current assets |
1,112,285 |
1,082,939 |
|
|
|
Long-term marketable securities |
148,411 |
231,385 |
Goodwill |
633,511 |
650,778 |
Other intangible assets, net |
57,678 |
66,861 |
Property and equipment, net |
288,027 |
297,919 |
Other long-term assets |
16,117 |
18,911 |
Total assets |
$ 2,256,029 |
$ 2,348,793 |
|
|
|
Liabilities and stockholders' equity |
|
|
Current liabilities: |
|
|
Accounts payable |
$ 16,028 |
$ 14,965 |
Other current liabilities |
108,576 |
164,150 |
Deferred revenue |
176,479 |
189,923 |
Total current liabilities |
301,083 |
369,038 |
|
|
|
Deferred revenue |
1,443 |
3,882 |
Deferred tax liabilities |
6,406 |
5,323 |
Other non-current liabilities |
73,959 |
74,858 |
Total liabilities |
382,891 |
453,101 |
|
|
|
Stockholders' equity: |
|
|
Common stock and additional paid in
capital |
3,143,285 |
3,096,982 |
Accumulated other comprehensive income
(loss) |
(51,350) |
(29,175) |
Accumulated deficit |
(1,218,797) |
(1,172,115) |
Total stockholders' equity |
1,873,138 |
1,895,692 |
Total liabilities and stockholders'
equity |
$ 2,256,029 |
$ 2,348,793 |
|
|
|
|
|
ZYNGA INC.
CONSOLIDATED STATEMENTS OF OPERATIONS (In
thousands, except per share data, unaudited) |
|
|
|
|
Three Months
Ended |
|
March
31, |
|
2015 |
2014 |
Revenue: |
|
|
Online game |
$ 147,963 |
$ 132,270 |
Advertising and other |
35,330 |
35,750 |
Total revenue |
183,293 |
168,020 |
Costs and expenses: |
|
|
Cost of revenue |
57,622 |
53,504 |
Research and development |
107,520 |
97,584 |
Sales and marketing |
31,839 |
29,853 |
General and administrative |
40,381 |
57,336 |
Total costs and expenses |
237,362 |
238,277 |
Income (loss) from operations |
(54,069) |
(70,257) |
Interest income (expense), net |
794 |
870 |
Other income (expense), net |
8,359 |
1,125 |
Income (loss) before income taxes |
(44,916) |
(68,262) |
Provision for (benefit from) income
taxes |
1,580 |
(7,079) |
Net income (loss) |
$ (46,496) |
$ (61,183) |
|
|
|
Net income (loss) per share: |
|
|
Basic and diluted |
$ (0.05) |
$ (0.07) |
Weighted average common shares used to
compute net income (loss) per share: |
|
|
Basic and diluted |
898,344 |
850,148 |
Stock-based expense included in the above
line items: |
|
|
Cost of revenue |
$ 1,072 |
$ 1,279 |
Research and development |
28,317 |
18,416 |
Sales and marketing |
1,519 |
1,458 |
General and administrative |
10,554 |
7,173 |
Total stock-based expense |
$ 41,462 |
$ 28,326 |
|
|
ZYNGA INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS (In
thousands, unaudited) |
|
|
|
|
Three Months
Ended |
|
March
31, |
|
2015 |
2014 |
Operating activities |
|
|
Net income (loss) |
$ (46,496) |
$ (61,183) |
Adjustments to reconcile net income (loss) to
net cash provided by (used in) operating activities: |
|
|
Depreciation and amortization |
17,722 |
25,344 |
Stock-based expense |
41,462 |
28,326 |
Accretion and amortization on marketable
securities |
2,087 |
2,786 |
(Gain) loss from sales of investments,
assets and other, net |
(6,056) |
382 |
Tax benefits (costs) from stock-based
awards |
-- |
436 |
Excess tax benefits from stock-based
awards |
-- |
(436) |
Deferred income taxes |
998 |
(7,935) |
Changes in operating assets and
liabilities: |
|
|
Accounts receivable, net |
10,090 |
(3,388) |
Income tax receivable |
(1,198) |
135 |
Other assets |
(7,687) |
(5,292) |
Accounts payable |
1,063 |
(8,597) |
Deferred revenue |
(15,883) |
(6,909) |
Other liabilities |
(43,104) |
12,085 |
Net cash provided by (used in) operating
activities |
(47,002) |
(24,246) |
|
|
|
Investing activities |
|
|
Purchase of marketable securities |
(101,091) |
(174,729) |
Sales and maturities of marketable
securities |
234,555 |
233,626 |
Acquisition of property and equipment |
(2,112) |
(1,234) |
Proceeds from sale of property and
equipment |
-- |
4,935 |
Business acquisition, net of cash
acquired |
-- |
(390,993) |
Proceeds for sale of equity method
investment |
10,507 |
-- |
Other investing activities, net |
-- |
200 |
Net cash provided by (used in) investing
activities |
141,859 |
(328,195) |
|
|
|
Financing activities |
|
|
Taxes paid related to net share settlement of
equity awards |
(1,008) |
(455) |
Proceeds from employee stock purchase plan
and exercise of stock options |
3,390 |
9,509 |
Excess tax benefits from stock-based
awards |
-- |
436 |
Acquisition related contingent consideration
payment |
(10,790) |
-- |
Net cash provided by (used in) financing
activities |
(8,408) |
9,490 |
Effect of exchange rate changes on cash and
cash equivalents |
(297) |
(119) |
Net increase (decrease) in cash and cash
equivalents |
86,152 |
(343,070) |
Cash and cash equivalents, beginning of
period |
131,303 |
465,523 |
Cash and cash equivalents, end of period |
$ 217,455 |
$ 122,453 |
|
|
ZYNGA INC.
RECONCILIATION OF GAAP TO NON-GAAP RESULTS
(In thousands, except per share data,
unaudited) |
|
|
|
|
Three months
ended |
|
March
31, |
|
2015 |
2014 |
Reconciliation of Revenue to
Bookings |
|
|
Revenue |
$ 183,293 |
$ 168,020 |
Change in deferred revenue |
(15,883) |
(6,662) |
Bookings |
$ 167,410 |
$ 161,358 |
|
|
|
Reconciliation of Net income (loss)
to Adjusted EBITDA |
|
|
Net income (loss) |
$ (46,496) |
$ (61,183) |
Provision for (benefit from) income
taxes |
1,580 |
(7,079) |
Other income (expense), net |
(8,359) |
(1,125) |
Interest income (expense), net |
(794) |
(870) |
Restructuring expense, net |
3,461 |
29,655 |
Depreciation and amortization |
17,722 |
25,344 |
Acquisition related transaction expenses |
-- |
6,160 |
Contingent consideration fair value
adjustment |
9,400 |
1,280 |
Stock-based expense |
41,462 |
28,326 |
Change in deferred revenue |
(15,883) |
(6,662) |
Adjusted EBITDA |
$ 2,093 |
$ 13,846 |
|
|
|
Reconciliation of Net income (loss)
to Non-GAAP net income (loss) |
|
|
Net income (loss) |
$ (46,496) |
$ (61,183) |
Acquisition related transaction expenses |
-- |
6,160 |
Contingent consideration fair value
adjustment |
9,400 |
1,280 |
Stock-based expense |
41,462 |
28,326 |
Amortization of intangible assets from
acquisitions |
6,264 |
2,607 |
Change in deferred revenue |
(15,883) |
(6,662) |
Restructuring expense, net |
3,461 |
29,655 |
Tax effect of non-GAAP adjustments to net
income (loss) |
(4,921) |
(6,441) |
Non-GAAP net income
(loss) |
$ (6,713) |
$ (6,258) |
|
|
|
GAAP and Non-GAAP diluted
shares |
898,344 |
850,148 |
Non-GAAP net income (loss) per
share: |
$ (0.01) |
$ (0.01) |
|
|
|
Reconciliation of Cash provided by
(used in) operating activities to Free cash flow |
|
|
Net cash provided by (used in) operating
activities |
(47,002) |
(24,246) |
Acquisition of property and equipment |
(2,112) |
(1,234) |
Excess tax benefits (loss) from stock-based
awards |
-- |
436 |
Free cash flow |
$ (49,114) |
$ (25,044) |
|
|
|
Reconciliation of GAAP to Non-GAAP
provision for (benefit from) income taxes |
|
|
GAAP provision for (benefit from) income
taxes |
1,580 |
(7,079) |
Stock-based expense |
4,564 |
2,973 |
Amortization of intangible assets from
acquisitions |
689 |
274 |
Contingent consideration fair value
adjustment |
1,035 |
134 |
Acquisition-related transaction expenses |
-- |
647 |
Change in deferred revenue |
(1,748) |
(699) |
Restructuring expense, net |
381 |
3,112 |
Non-GAAP provision for (benefit from)
income taxes |
$ 6,501 |
$ (638) |
ZYNGA INC.
RECONCILIATION OF GAAP TO NON-GAAP SECOND QUARTER 2015 OUTLOOK (In
thousands, except per share data, unaudited) |
|
|
|
Second Quarter
2015 |
Reconciliation of Revenue to
Bookings |
|
Revenue range |
$ 175,000 – 190,000 |
Change in deferred revenue |
(30,000) |
Bookings range |
$ 145,000 – 160,000 |
|
|
Reconciliation of Net income (loss)
to Adjusted EBITDA |
|
Net income (loss) range |
$ (54,000) – (50,000) |
Provision for (benefit from) income
taxes |
1,000 – 3,000 |
Other income (expense), net |
(2,000) |
Interest income (expense), net |
(1,000) |
Restructuring expense, net |
18,000 – 22,000 |
Depreciation and amortization |
15,000 |
Stock-based expense |
33,000 |
Change in deferred revenue |
(30,000) |
Adjusted EBITDA range |
$ (20,000) – (10,000) |
|
|
Reconciliation of Net income (loss)
to Non-GAAP net income (loss) |
|
Net income (loss) range |
$ (54,000) – (50,000) |
Stock-based expense |
33,000 |
Amortization of intangible assets from
acquisitions |
6,000 |
Change in deferred revenue |
(30,000) |
Restructuring expense, net |
18,000 – 22,000 |
Tax effect of non-GAAP adjustments to net
income (loss) |
5,000 – 4,000 |
Non-GAAP net income (loss)
range |
$ (22,000) – (15,000) |
|
|
GAAP and Non-GAAP diluted
shares |
905,000 |
Net income (loss) per
share |
$ (0.06) |
Non-GAAP net income (loss) per
share |
$ (0.02) |
CONTACT: Investors - Melissa Fisher
415-339-5266
investors@zynga.com
Press - Stephanie Hess
415-503-0303
press@zynga.com
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