Zynga was full of surprises Thursday.
The social gaming company announced Q4 and year end financials on Thursday a full week ahead of schedule, but these numbers were somewhat overshadowed by an unexpected acquisition and plans for another round of layoffs.
The layoffs, which will include more than 300 jobs (15% of the company’s workforce), comes just seven months after Zynga unexpectedly laid off more than 500 employees back in June. The company shut down three offices alongside June’s layoffs, and this round of layoffs will save the company “$33 to $35 million in pre-tax savings for 2014,” according to the company’s earnings release.
The acquisition announcement was sunnier news for the San Francisco-based company, which aims to continue its push into mobile gaming. Zynga announced the acquisition of mobile games developer NaturalMotion for $527 million, including nearly 40 million shares of Zynga stock. NaturalMotion was founded in 2001, has around 260 employees worldwide, and created games like Clumsy Ninja and the racing game CSR Classics.
“We believe that bringing Zynga and NaturalMotion together is the right step at the right time,” said Zynga CEO Don Mattrick in a statement from the company’s earnings release. “Our acquisition of NaturalMotion will allow us to significantly expand our creative pipeline, accelerate our mobile growth and bring next-generation technology and tools to Zynga that we believe will fast track our ability to deliver more hit games.”
The kicker on Thursday was Zynga’s financials, which beat Wall Street estimates despite a considerable dip from the same quarter last year. Zynga posted revenues of $176 million in Q4, down from $311 million in Q4 2012. For the year, Zynga revenue was $873 million, down from $1.28 billion in 2012.
Perhaps most alarming is Zynga’s eroding user base. The company announced 27 million daily active users in Q4, down 12% from the DAU figure in Q3, and less than half the DAU total Zynga boasted in the same quarter last year.
As of 7:30 p.m. ET Thursday, Zynga stock was up nearly 18% in after-hours trading on news of the acquisition, earnings, and cost cutting (layoffs).