Online social gaming service Zynga has announced a $4.1 million profit in the first quarter of 2013. While the news was welcomed by those at the company, it came as a surprise due to the dwindling number of people playing the games on Zynga’s service. Analysts even predicted the company would actually lose over $27 million in the quarter.
But Zynga’s top brass worked hard to ensure this would not happen.
They were able to turn things around largely due to aggressive cost-cutting endeavours undertaken in recent months. As part of the measures, at least eleven games offered by Zynga were shut down in December and January. The company also saved on costs by removing a number of its games from app stores and laying off a number of their employees.
Among the games offered by Zynga is Zynga Poker, which has the distinction of being the first social game offered by the company. Zynga also boasts that its poker game is the biggest free-to-play online poker service on the planet, the fourth most popular game on Facebook, as well as a top-10 grossing game in the Apple App Store. Zynga Poker does not seem to have been affected by any of the company’s cost-cutting initiatives.
Despite the surprising profit, the company seems to have a cautious outlook on the situation ahead. The company’s CEO, Mark Pinkus, has already predicted a significant decline in second quarter bookings and expects Zynga to lose between three and four cents per share in the next quarter. This would be in contrast to Zynga’s one cent per share profit it achieved in the first quarter.