Weak second-quarter financial results for Zynga — and worse expectations for the rest of the year — sent its already faltering stock down in after-hours trading Wednesday by more than a third, David Streitfeld and Jenna Wortham report in Thursday’s New York Times.
The unexpected news was seen as boding ill for Facebook, which is closely tied to Zynga and will issue its first earnings report as a public company on Thursday. Facebook shares were down 5.4 percent in premarket trading.
For Zynga, a Silicon Valley darling whose public offering last December seemed to herald a wave of tech success, just about everything went wrong at once.
A brief list: Facebook made changes to its gaming platform that hampered Zynga regulars. A critical new game, the Ville, was delayed. Another new game, Mafia Wars II, just was not very good, executives conceded. The heavily hyped Draw Something, acquired in March, proved more fad than enduring classic. Some old standbys also lost some appeal.
Like I said recently, in three years Facebook is going to feel like riding in a buggy.