Zynga "FarmVille" creator shuts down its Boston office and has laid off 5 percent of its full-time workforce and may also close its Japanese and British offices. It is due to steep decline in earnings as users gradually migrate to mobile devices. They will also end 13 unspecified older game titles, Chief Executive Mark Pincus said.
Rumors of the layoffs in Austin and Boston had spread on gaming blogs and over social networks during the day, and the company's shares closed down more than 5 percent, at $2.20. But they bounced back 4.5 percent to $2.30 in after-hours trade, following news of the cost-cutting initiatives.
Zynga went public to much fanfare in December at $10 a share but has since lost over three-quarters of its market value. It has been hit by delays in its game pipeline as older titles fade, while it has struggled to come up with new hits for mobile devices.
With its top line shrinking, Pincus told employees in an earlier memo just this month that he was disappointed by the results but urged his staff not to lose sight of the bigger picture.
source yahoo news/Reuters
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