Zynga Swings To Q2 Profit, Shares Tank 14% On Weak Outlook

(RTTNews) - Zynga Inc. (ZNGA) Thursday posted a profit for the second-quarter, driven by revenue growth. However, the company issued a weak guidance for the third quarter, sending its shares down 14% in the extended session.

Zynga reported second-quarter profit of $27.8 million or $0.02 per share, compared to net loss of $150.3 million or $0.16 per share last year.

Total revenues for the quarter grew to $720.0 million from $451.7 million last year.

Analysts polled by Thomson Reuters expected the company to report earnings of $0.09 per share and revenues of $713.01 million for the quarter. Analysts' estimates typically exclude special items.

Looking forward to third quarter, Zynga expects a loss of $0.10 per share on revenues of $665.0 million. Analysts currently estimate an earnings of $0.09 per share on revenues of $721.69 million.

Separately, Zynga said it has agreed to buy StarLark, the developer of Golf Rival, from Betta Games for $525 million in cash and stock. StarLark also expands Zynga's international presence by establishing a China-based studio with access to the region's creative talent base.

The company will pay $315 million in cash and around $210 million of its common stock. The deal is expected to close in the fourth quarter of 2021.

Further, Zynga said it completed the acquisition of Chartboost, a mobile advertising and monetization platform, for about $250 million in cash.

ZNGA closed Thursday's trading at $9.77, down $0.13 or 1.31%, on the Nasdaq. The stock further slipped $1.40 or 14.28% in the after-hours trade.