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Why Zynga Shares Popped Today

By Evan Niu, CFA - May 5, 2016 at 12:45PM

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The game maker's new CEO is off to a good start.

Image source: Zynga.

What: Shares of social game maker Zynga (ZNGA -2.04%) have popped today, up by 12% as of 11:53 a.m. ET, after the company reported strong first-quarter earnings.

So what: Revenue in the first quarter added up to $186.7 million, with non-GAAP bookings of $181.6 million. Adjusted net income was $1.5 million, which rounds down to $0.00 per share. Both figures easily topped analyst expectations, which were pegged at $163.4 million in bookings and an adjusted net loss of $0.01 per share.

Now what: Zynga continues its transition to mobile, with mobile bookings of $139 comprising 76% of all bookings. Average mobile daily active users grew 7% sequentially to 16 million. The strong report comes just months after Zynga founder Mark Pincus stepped down as CEO for the second time, naming Frank Gibeau as the new CEO. Cost-cutting has helped bolster bottom-line results, and aided margins. For the second quarter, bookings are expected to be $160 million to $170 million.

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