Zynga Q1 Loss Narrows, Tops Street; Shares Up

(RTTNews) - Zynga Inc. (ZNGA) on Thursday reported a first-quarter loss that narrowed from a year ago, reflecting an increase in revenues despite continued drop in user-base. Earnings for the quarter trumped analysts estimates, as did revenues, sending the company's shares up 13 percent in extended trading hours.

San Francisco, California-based Zynga's first-quarter loss narrowed to $26.6 million or $0.03 per share from last year's loss of $46.5 million or $0.05 per share.

Excluding one-time items, adjusted earnings for the quarter were break even per share compared to a loss of $0.01 last year. On average, 17 analysts polled by Thomson Reuters estimated a loss of $0.01 per share for the quarter. Analysts' estimates typically exclude special items.

Zynga's revenues for the quarter rose to $186.7 million from $183.3 million a year ago. Bookings or revenues minus deferred revenues, which is a closely watched metric, increased to $181.6 million from $167.4 million last year. Analysts estimated revenues of $162.2 million for the quarter.

Zynga has been under pressure as its user base continued to decline for past several quarters. Zynga generates majority of its revenues from the virtual-goods purchases made by its online gamers and through ads. However, the gaming company behind once very popular PC-based games such as FarmVille is now struggling as casual gamers now spend more time on tablets and smartphones.

During the quarter, Zynga daily active users plunged 21 percent year-over-year to 19 million, while monthly active users declined 32 percent to 68 million.

Looking forward to the second quarter, the company expects loss of $0.03 to $0.02 per share and revenues of $170 million to $180 million. Analysts currently estimate earnings to be break even per share on revenues of $170.38 million.