There is no continuous growth rate for any company, as there has to come a point where even the fastest growing figures would hit the proverbial wall before a correction is made. It is one of those laws of life, and when it comes to what used to be the darling of news journalists everywhere covering technology start ups and the next best thing since sliced bread, Zynga has certainly lost much of its lustre, although it is still far away from being a pushover in the industry. It is official that Zynga has had to perform some cost cutting measures, shedding 18% of its workforce that would indirectly result in the closing down of its Austin, Dallas, LA, and New York studios.
An 18% headcount has been estimated to be in the region of approximately 500 employees, and because of the breadth of the layoffs, Zynga has gone ahead to freeze trading of its stock on NASDAQ. Not only, that, things do not look too rosy for Zynga as the company’s updated financial outlook comes with a $28.5 to $39 million loss in the second quarter of the year. Zynga Founder and CEO Mark Pincus said, “None of us ever expected to face a day like today, especially when so much of our culture has been about growth. But I think we all know this is necessary to move forward. The scale that served us so well in building and delivering the leading social gaming service on the Web is now making it hard to successfully lead across mobile and multiplatform, which is where social games are going to be played.” Hopefully the affected will be able to find a replacement job, soon! [Press Release]