Delivers Strong Quarterly Revenue and
Bookings
Reports Highest Ever Q1 Advertising Revenue
and Bookings
Continued Execution Across Multi-Year Growth
Strategy
Zynga Inc. (NASDAQ: ZNGA) today released financial results for
the first quarter ended March 31, 2022.
“We started off 2022 with a strong quarterly performance,
achieving our highest ever Q1 advertising revenue and bookings led
by our hyper-casual portfolio,” said Frank Gibeau, CEO of Zynga.
“Through continued execution across all aspects of our multi-year
growth strategy including live services, new game development and
investments in our advertising platform, new markets and
technologies, we are strengthening our position as a leading
mobile-first, free-to-play live services company.”
First Quarter 2022 Financial
Summary
$ in millions
Q1’22
Actuals
Q1’21
Actuals
Variance
$
(Y/Y)
Variance
%
(Y/Y)
Revenue
$
691
$
680
$
11
2
%
Net release of (increase in) deferred
revenue (1)
$
(4
)
$
(39
)
$
36
(91
%)
Bookings
$
695
$
720
$
(25
)
(3
%)
Net income (loss)
$
(25
)
$
(23
)
$
(2
)
7
%
Adjusted EBITDA (2)
$
144
$
123
$
21
17
%
Note: Certain measures as presented differ
due to the impact of rounding.
(1)
For clarity, a net release of deferred
revenue results in revenue being higher than bookings and is a
positive impact to Adjusted EBITDA as reported; a net increase in
deferred revenue results in revenue being lower than bookings and
is a negative impact to Adjusted EBITDA as reported.
(2)
Adjusted EBITDA includes the net release
of (increase in) deferred revenue.
- Revenue & Bookings: In Q1, we achieved revenue of
$691 million, up 2% year-over-year, and quarterly bookings of $695
million, down 3% year-over-year. Online game or user pay revenue
was $538 million, down 3% year-over-year, and user pay bookings
were $528 million, down 11% year-over-year. Advertising & other
revenue was a Q1 record of $154 million, up 24% year-over-year, and
advertising & other bookings reached its highest Q1 performance
of $167 million, up 35% year-over-year.
- Audience Metrics: Average mobile daily active users
(DAUs) were 40 million, up 3% year-over-year, and average mobile
monthly active users (MAUs) were 209 million, up 27%
year-over-year. Mobile average bookings per mobile DAU (ABPU) of
$0.190 were down 6% year-over-year.
- Costs & Expenses: Cost of revenue was $252 million
or 36% of revenue, compared to 38% of revenue in the year-ago
quarter. Non-GAAP cost of revenue was $185 million or 27% of
bookings, down from 29% of bookings in the year-ago quarter. GAAP
operating expenses were $424 million, representing 61% of revenue
and an improvement from 62% in the year-ago quarter. Non-GAAP
operating expenses of $364 million represented 52% of bookings,
versus 49% in the year-ago quarter.
- Profitability & Cash Flow: Net loss was $25 million,
compared to a net loss of $23 million in the year-ago quarter, and
Adjusted EBITDA was $144 million, up $21 million year-over-year. We
had an operating cash outflow of $203 million versus a cash outflow
of $164 million in the prior year quarter. In the quarter, we
completed the final earn out payments related to the acquisitions
of Small Giant Games and Rollic, totaling $265 million.
Due to the pending transaction with Take-Two Interactive
Software, Inc. (“Take-Two”) announced on January 10, 2022, Zynga is
not hosting a conference call or providing forward guidance in
connection with the release of its quarterly results.
Additional information regarding the pending transaction with
Take-Two is provided in a registration statement on Form S-4 filed
by Take-Two with the U.S. Securities and Exchange Commission (the
“SEC”) in connection with the transaction, which includes a joint
proxy statement/prospectus of Zynga and Take-Two, and all other
relevant documents filed with the SEC. The registration statement
was declared effective on April 7, 2022 and the definitive joint
proxy statement/prospectus was sent to Zynga and Take-Two
stockholders.
About Zynga Inc.
Zynga is a global leader in interactive entertainment with a
mission to connect the world through games. With massive global
reach in more than 175 countries and regions, Zynga has a diverse
portfolio of popular game franchises that have been downloaded more
than four billion times on mobile including CSR Racing™, Empires
& Puzzles™, FarmVille™, Golf Rival™, Hair Challenge™, Harry
Potter: Puzzles & Spells™, High Heels!™, Merge Dragons!™, Merge
Magic!™, Toon Blast™, Toy Blast™, Words With Friends™ and Zynga
Poker™. With Chartboost, a leading mobile advertising and
monetization platform, Zynga is an industry-leading next-generation
platform with the ability to optimize programmatic advertising and
yields at scale. Founded in 2007, Zynga is headquartered in
California with locations in North America, Europe and Asia. For
more information, visit www.zynga.com or follow Zynga on Twitter,
Instagram, Facebook or the Zynga blog.
Key Operating Metrics
We manage our business by tracking several operating metrics:
“Mobile DAUs,” which measure daily active users of our mobile
games, “Mobile MAUs,” which measure monthly active users of our
mobile games, and “Mobile ABPU,” which measures our average daily
mobile bookings per average Mobile DAU, each of which is recorded
and estimated by our internal analytics systems. We determine these
operating metrics by using internal company data based on tracking
of user account activity. We also use information provided by third
parties, including third party network logins provided by platform
providers, to help us track whether a player logged in under two or
more different user accounts is the same individual. Overall, we
believe that the amounts are reasonable estimates of our user base
for the applicable period of measurement and that the methodologies
we employ and update from time-to-time are reasonably based on our
efforts to identify trends in player behavior. However, factors
relating to user activity and systems and our ability to identify
and detect attempts to replicate legitimate player activity may
impact these numbers.
Mobile DAUs. We define Mobile DAUs as the number of individuals
who played one of our mobile games during a particular day. Average
Mobile DAUs for a particular period is the average of the Mobile
DAUs for each day during that period. Under this metric, an
individual who plays two different mobile games on the same day is
counted as two DAUs. We use information provided by third parties
to help us identify individuals who play the same game to reduce
this duplication. However, we do not have the third party network
login data to link an individual who has played under multiple user
accounts for our hyper-casual games (which includes the games
acquired from Rollic in October 2020), mobile messenger games
(prior to the third quarter of 2021), Puzzle Combat, Merge Magic!
and games acquired from Gram Games in May 2018, Small Giant in
January 2019, Peak in July 2020 and StarLark in October 2021, and
accordingly, actual Mobile DAUs may be lower than reported due to
the potential duplication of these individuals. We use Mobile DAUs
as a measure of audience engagement.
Mobile MAUs. We define Mobile MAUs as the number of individuals
who played one of our mobile games in the 30-day period ending with
the measurement date. Average Mobile MAUs for a particular period
is the average of the Mobile MAUs at each month-end during that
period. Under this metric, an individual who plays two different
mobile games in the same 30-day period is counted as two Mobile
MAUs. We use information provided by third parties to help us
identify individuals who play the same game to reduce this
duplication. However, we do not have the third party network login
data to link an individual who has played under multiple user
accounts for our hyper-casual games (which includes the games
acquired from Rollic in October 2020), mobile messenger games
(prior to the third quarter of 2021), Puzzle Combat, Merge Magic!
and games acquired from Gram Games in May 2018, Small Giant in
January 2019, Peak in July 2020 and StarLark in October 2021, and
accordingly, actual Mobile MAUs may be lower than reported due to
the potential duplication of these individuals. We use Mobile MAUs
as a measure of total game audience size.
Mobile ABPU. We define Mobile ABPU as our total mobile bookings
in a given period, divided by the number of days in that period,
divided by the average Mobile DAUs during the period. We believe
that Mobile ABPU provides useful information to investors and
others in understanding and evaluating our results in the same
manner as management. We use Mobile ABPU as a measure of overall
monetization across all of our players through the sale of virtual
items and advertising.
Our business model around our social games is designed so that,
as more players play our games, social interactions increase and
the more valuable our games and our business become. All engaged
players of our games help drive our bookings and, consequently,
both online game revenue and advertising revenue. Virtual items are
purchased by players who are socializing with, competing against or
collaborating with other players, most of whom do not buy virtual
items. Accordingly, we primarily focus on Mobile DAUs, Mobile MAUs
and Mobile ABPU, which we believe collectively best reflect key
audience metrics.
Non-GAAP Financial
Measures
We have provided in this press release certain non-GAAP
financial measures to supplement our consolidated financial
statements prepared in accordance with U.S. GAAP (our “GAAP
financial statements”). Management uses non-GAAP financial measures
internally in analyzing our financial results to assess operational
performance and liquidity. Our non-GAAP financial measures may be
different from non-GAAP financial measures used by other
companies.
The presentation of our non-GAAP financial measures is not
intended to be considered in isolation or as a substitute for, or
superior to, our GAAP financial statements. We believe that both
management and investors benefit from referring to our non-GAAP
financial measures in assessing our performance and when planning,
forecasting and analyzing future periods. We believe our non-GAAP
financial measures are useful to investors because they allow for
greater transparency with respect to key financial measures 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 of our non-GAAP financial
measures used in this press release to the most directly comparable
GAAP financial measures in the following tables. Because of the
following limitations of our non-GAAP financial measures, you
should consider the non-GAAP financial measures presented in this
press release with our GAAP financial statements.
Key limitations of our non-GAAP financial measures include:
- Bookings does not reflect that we defer and recognize online
game revenue and revenue from certain advertising transactions over
the estimated average playing period of payers for durable virtual
items or as consumed for consumable virtual items; bookings also
includes other adjustments, if applicable;
- Adjusted EBITDA does not include the impact of stock-based
compensation expense, acquisition-related transaction expenses,
contingent consideration adjustments, legal settlements and related
legal expense, and expenses incurred from vacated leases (which
includes impairment charges recognized);
- Adjusted EBITDA does not reflect provisions for or benefits
from income taxes and does not include other income (expense) net,
which includes foreign exchange and asset disposition gains and
losses, interest expense and interest income;
- Adjusted EBITDA excludes depreciation and amortization of
tangible and intangible assets. Although depreciation and
amortization are non-cash charges, the assets being depreciated or
amortized may have to be replaced in the future;
- Free cash flow is derived from net cash provided by operating
activities less cash spent on capital expenditures; and
- Non-GAAP Cost of Revenue and Non-GAAP Operating Expenses do not
include the impact of amortization of intangible assets from
acquisitions, contingent consideration adjustments,
acquisition-related transaction expenses, legal settlements and
related legal expense, expenses incurred from vacated leases or
stock-based compensation expense.
ZYNGA INC.
CONSOLIDATED BALANCE
SHEETS
(In millions, unaudited)
March 31,
December 31,
2022
2021
Assets
Current assets:
Cash and cash equivalents
$
826.0
$
984.0
Short-term investments
10.5
169.0
Accounts receivable, net of allowance of
$0.9 at March 31, 2022 and December 31, 2021
233.4
242.5
Restricted cash
81.0
161.0
Prepaid expenses
68.4
56.7
Other current assets
47.4
35.4
Total current assets
1,266.7
1,648.6
Goodwill
3,586.8
3,601.1
Intangible assets, net
834.8
900.5
Property and equipment, net
36.6
30.3
Right-of-use assets
84.1
86.4
Restricted cash
0.2
40.2
Prepaid expenses
18.9
25.0
Other non-current assets
31.9
26.8
Total assets
$
5,860.0
$
6,358.9
Liabilities and stockholders’
equity
Current liabilities:
Accounts payable
$
48.4
$
95.6
Income tax payable
30.9
52.2
Deferred revenue
746.4
748.1
Operating lease liabilities
17.9
17.1
Other current liabilities
284.0
650.4
Total current liabilities
1,127.6
1,563.4
Convertible senior notes, net
1,542.1
1,343.8
Deferred revenue
0.3
0.3
Deferred tax liabilities, net
84.6
93.8
Non-current operating lease
liabilities
131.6
133.4
Other non-current liabilities
67.7
112.3
Total liabilities
2,953.9
3,247.0
Stockholders’ equity:
Common stock and additional paid-in
capital
5,398.6
5,625.0
Accumulated other comprehensive income
(loss)
(138.3
)
(107.1
)
Accumulated deficit
(2,354.2
)
(2,406.0
)
Total stockholders’ equity
2,906.1
3,111.9
Total liabilities and
stockholders’ equity
$
5,860.0
$
6,358.9
ZYNGA INC.
CONSOLIDATED STATEMENTS OF
OPERATIONS
(In millions, except per share
data, unaudited)
Three Months Ended
March 31, 2022
December 31, 2021
March 31, 2021
Revenue:
Online game
$
537.7
$
534.0
$
557.0
Advertising and other
153.5
161.4
123.3
Total revenue
691.2
695.4
680.3
Costs and expenses:
Cost of revenue
252.2
260.1
260.7
Research and development
112.4
151.9
140.7
Sales and marketing
251.1
245.6
248.7
General and administrative
60.5
39.1
35.7
Total costs and expenses
676.2
696.7
685.8
Income (loss) from operations
15.0
(1.3
)
(5.5
)
Interest income
0.9
1.4
1.7
Interest expense
(3.1
)
(15.0
)
(14.7
)
Other income (expense), net
(15.7
)
(10.2
)
8.9
Income (loss) before income
taxes
(2.9
)
(25.1
)
(9.6
)
Provision for (benefit from) income
taxes
21.6
42.1
13.4
Net income (loss)
$
(24.5
)
$
(67.2
)
$
(23.0
)
Net income (loss) per share
attributable to common stockholders:
Basic
$
(0.02
)
$
(0.06
)
$
(0.02
)
Diluted
$
(0.02
)
$
(0.06
)
$
(0.02
)
Weighted-average common shares used to
compute net income (loss) per share attributable to common
stockholders:
Basic
1,133.2
1,124.9
1,084.4
Diluted
1,133.2
1,124.9
1,084.4
Stock-based compensation expense
included in the above line items:
Cost of revenue
$
0.7
$
0.8
$
0.6
Research and development
31.0
27.7
24.3
Sales and marketing
4.8
4.8
3.9
General and administrative
8.5
8.9
8.4
Total stock-based compensation
expense
$
45.0
$
42.2
$
37.2
ZYNGA INC.
CONSOLIDATED STATEMENTS OF
CASH FLOWS
(In millions, unaudited)
Three Months Ended
March 31, 2022
December 31, 2021
March 31, 2021
Cash flows from operating
activities:
Net income (loss)
$
(24.5
)
$
(67.2
)
$
(23.0
)
Adjustments to reconcile net income (loss)
to net cash provided by (used in) operating activities:
Depreciation and amortization
69.2
68.2
56.5
Stock-based compensation expense
45.0
42.3
37.2
(Gain) loss from derivatives, sale of
investments and other assets and foreign currency, net
26.6
18.3
(9.0
)
Noncash lease expense
3.9
4.0
4.2
Noncash interest expense
1.6
13.7
13.2
Change in deferred income taxes and
other
(9.3
)
(6.9
)
(15.2
)
Changes in operating assets and
liabilities:
Accounts receivable, net
8.2
(33.5
)
(59.5
)
Prepaid expenses and other assets
(19.2
)
(3.1
)
(2.0
)
Accounts payable
(46.3
)
45.0
(18.8
)
Deferred revenue
4.3
22.1
40.4
Income tax payable
(30.0
)
(20.4
)
5.9
Operating lease and other liabilities
(232.2
)
75.6
(193.6
)
Net cash provided by (used in)
operating activities
(202.7
)
158.1
(163.7
)
Cash flows from investing
activities:
Purchases of investments
(2.2
)
(1.5
)
(537.2
)
Maturities of investments
84.8
83.5
83.9
Sales of investments
74.0
—
—
Acquisition of property and equipment
(10.3
)
(5.7
)
(1.7
)
Business combinations, net of cash
acquired
(12.6
)
(286.1
)
(19.6
)
Release of restricted cash escrow from
business combinations
(120.0
)
—
—
Asset acquisitions of intangible
assets
(1.0
)
—
(0.9
)
Other investing activities, net
(20.4
)
(8.0
)
(0.3
)
Net cash provided by (used in)
investing activities
(7.7
)
(217.8
)
(475.8
)
Cash flows from financing
activities:
Debt issuance costs paid
—
—
(0.9
)
Taxes paid related to net share settlement
of stockholders' equity awards
(5.7
)
(2.5
)
(8.2
)
Proceeds from issuance of common stock
7.3
18.3
10.5
Acquisition-related contingent
consideration payments
(56.6
)
—
(25.1
)
Net cash provided by (used in)
financing activities
(55.0
)
15.8
(23.7
)
Effect of exchange rate changes on
cash, cash equivalents and restricted cash
(12.6
)
(19.3
)
(1.7
)
Net change in cash, cash equivalents
and restricted cash
(278.0
)
(63.2
)
(664.9
)
Cash, cash equivalents and restricted
cash, beginning of period
1,185.2
1,248.4
1,500.4
Cash, cash equivalents and restricted
cash, end of period
$
907.2
$
1,185.2
$
835.5
ZYNGA INC.
RECONCILIATION OF GAAP TO
NON-GAAP RESULTS
(In millions, unaudited)
Three Months Ended
March 31, 2022
December 31, 2021
March 31, 2021
Reconciliation of Revenue to Bookings:
Total
Revenue
$
691.2
$
695.4
$
680.3
Change in deferred revenue
3.7
21.2
39.2
Other bookings adjustments
—
10.0
—
Bookings
$
694.9
$
726.6
$
719.5
Reconciliation of Revenue to Bookings:
Mobile
Revenue
$
672.2
$
673.9
$
660.7
Change in deferred revenue
3.8
21.1
38.9
Bookings
$
676.0
$
695.0
$
699.6
Reconciliation of Revenue to Bookings:
Online Game
Revenue
$
537.7
$
534.0
$
557.0
Change in deferred revenue
(9.4
)
21.2
39.3
Bookings
$
528.3
$
555.2
$
596.3
Reconciliation of Revenue to Bookings:
Advertising & Other
Revenue
$
153.5
$
161.4
$
123.3
Change in deferred revenue
13.0
0.1
(0.1
)
Other bookings adjustments
—
10.0
—
Bookings
$
166.5
$
171.5
$
123.2
Reconciliation of Net Income (Loss) to
Adjusted EBITDA
Net income (loss)
$
(24.5
)
$
(67.2
)
$
(23.0
)
Provision for (benefit from) income
taxes
21.6
42.1
13.4
Other expense (income), net
15.7
10.2
(8.9
)
Interest income
(0.9
)
(1.4
)
(1.7
)
Interest expense
3.1
15.0
14.7
Depreciation and amortization
68.7
67.6
56.5
Acquisition-related transaction
expenses
12.5
4.6
1.5
Contingent consideration adjustments
(13.7
)
28.9
33.4
(Gain) loss on legal settlements and
related legal expense
12.0
—
—
Expenses incurred from vacated
lease(1)
4.9
4.6
—
Stock-based compensation expense
45.0
42.2
37.2
Adjusted EBITDA
$
144.4
$
146.6
$
123.1
Reconciliation of GAAP Operating
Expense to Non-GAAP Operating Expense
GAAP operating expense
$
424.0
$
436.6
$
425.1
Acquisition-related transaction
expenses
(12.5
)
(4.6
)
(1.5
)
Contingent consideration adjustments
13.7
(28.9
)
(33.4
)
Gain (loss) on legal settlements and
related legal expense
(12.0
)
—
—
Expenses incurred from vacated
lease(1)
(4.9
)
(4.6
)
—
Stock-based compensation expense
(44.3
)
(41.4
)
(36.6
)
Non-GAAP operating expense
$
364.0
$
357.1
$
353.6
Reconciliation of Cash Provided by
Operating Activities to Free Cash Flow
Net cash provided by (used in) operating
activities
$
(202.7
)
$
158.1
$
(163.7
)
Acquisition of property and equipment
(10.3
)
(5.7
)
(1.7
)
Free cash flow
$
(213.0
)
$
152.4
$
(165.4
)
(1)
Amount includes impairment charges (if applicable), rent and
other expenses (including depreciation) associated with our
impaired office buildings.
ZYNGA INC.
RECONCILIATION OF GAAP TO
NON-GAAP COSTS AND EXPENSES
(In millions, unaudited)
Three Months Ended March 31,
2022
GAAP measure
Amortization of intangible assets
from acquisitions
Contingent consideration
adjustments
Acquisition related expenses
Gain (loss) on legal settlements
and related legal expense
Expenses incurred from vacated
lease
Stock-based compensation
expense
Non-GAAP measure
Cost of revenue
252.2
(66.1
)
—
—
—
—
(0.7
)
185.4
Operating expenses
Research and development
112.4
—
13.7
(1.3
)
—
—
(31.0
)
93.8
Sales and marketing
251.1
—
—
(0.1
)
—
—
(4.8
)
246.2
General and administrative
60.5
—
—
(11.1
)
(12.0
)
(4.9
)
(8.5
)
24.0
Total operating expenses
424.0
—
13.7
(12.5
)
(12.0
)
(4.9
)
(44.3
)
364.0
Total costs and expenses
$
676.2
$
(66.1
)
$
13.7
$
(12.5
)
$
(12.0
)
$
(4.9
)
$
(45.0
)
$
549.4
Three Months Ended March 31,
2021
GAAP measure
Amortization of intangible assets
from acquisitions
Contingent consideration
adjustments
Acquisition related expenses
Gain (loss) on legal settlements
and related legal expense
Expenses incurred from vacated
lease
Stock-based compensation
expense
Non-GAAP measure
Cost of revenue
260.7
(52.8
)
—
—
—
—
(0.6
)
207.3
Operating expenses
Research and development
140.7
—
(33.4
)
—
—
—
(24.3
)
83.0
Sales and marketing
248.7
—
—
—
—
—
(3.9
)
244.8
General and administrative
35.7
—
—
(1.5
)
—
—
(8.4
)
25.8
Total operating expenses
425.1
—
(33.4
)
(1.5
)
—
—
(36.6
)
353.6
Total costs and expenses
$
685.8
$
(52.8
)
$
(33.4
)
$
(1.5
)
$
—
$
—
$
(37.2
)
$
560.9
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220509005777/en/
Investor Relations: Investors@zynga.com
Media Relations: Kenny Johnston Press@zynga.com
Zynga (NASDAQ:ZNGA)
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부터 12월(12) 2024 으로 1월(1) 2025
Zynga (NASDAQ:ZNGA)
과거 데이터 주식 차트
부터 1월(1) 2024 으로 1월(1) 2025
