Zynga Buys Privately-held Mobile Game Developer Gram Games

(RTTNews) - Zynga Inc. (ZNGA) said it has acquired privately-held mobile game developer Gram Games for $250 million in cash and a three-year earn out based on the team's achievement of profitability goals that align with Zynga's long-term growth plans.

Zynga expects its acquisition of Gram Games will be an additional catalyst to its growth and delivery of its long-term profitability targets.

Zynga remains on track to deliver results, excluding the contribution from Gram Games, in line with its original Q2 guidance as communicated during Zynga's Q1 2018 earnings call.

For GAAP purposes, Zynga does not expect any significant revenue impact from Gram Games, as the expected bookings generated in the second-quarter of $10 million will be accounted for as an increase in deferred revenue and recognized as revenue in future quarters.

Zynga expects a reduction to its Adjusted EBITDA of $8 million, as a result of the $10 million increase in deferred revenue partially offset by $2 million of expected operating contribution.