Could someone who didn't see this coming please explain to me how there was another outcome for this company?
I'm being completely serious. When I read headlines like this I just assume this happened at least nine months ago. I'd like to hear some reasoned defense of how this company was going to survive.
Well, it makes a _ton_ of money ($1.3b ttm revs). Is, by far, the leading web-based/social gaming company. Is an excellent acquisition target. Has, by far, the most DAUs/MAUs. Is in an easy-to-monetize industry. Would be in the best position to take advantage of relaxed gambling laws. And on and on. What don't you get?
"Could someone who didn't see this coming please explain to me...how this company was going to survive"
How were they going to survive? They aren't dead. Not even close.
Pincus has the same kind of control over Zynga that Zuckerberg has over Facebook, and he's got a mountain of cash in the bank. That means nobody can make him do anything and he has a very long time to get his house in order.
All they would have to do to make Wall Street happy now is lay-off a whole bunch of people and start making 20% profit. The stock would go to $10+ instantly. That's the easy way out, not planning for the long run. Not planning for growth.
Zynga is in a great position for real-money gaming, as just one possible avenue for future growth. The US government is taking longer than expected to regulate that industry but they will get around to it.
Zynga has been public for less than a year and they've got many years of runway left even if things don't improve. People need to slow down on thinking and claiming they are done.
I'm being completely serious. When I read headlines like this I just assume this happened at least nine months ago. I'd like to hear some reasoned defense of how this company was going to survive.