Massive Layoffs At Zynga

Troubled social game maker Zynga laid off 520 staff today, or 18 per cent of the company's employees, the company said in a press release today. The goal: refocus on mobile gaming.

Zynga is also shutting down its New York, Dallas and LA offices, according to a report by AllThingsD.

The massive social game maker, responsible for popular games like FarmVille and Words With Friends, has been facing financial difficulties for quite some time now. Zynga spent $US210 million to buy Draw Something, a game that immediately tanked, and it has had trouble figuring out how to make significant profits off its Facebook games. Last year, Zynga's stock tanked, and the company has been reeling ever since.

Here's the letter Zynga CEO Mark Pincus sent to staff today:

To our Zynga Community,

Today is a hard day for Zynga and an emotional one for every employee of our company. We are saying painful goodbyes to about 18% of our Zynga brothers and sisters. The impact of these layoffs will be felt across every group in the company.

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.

These moves, while hard to face today, represent a proactive commitment to our mission of connecting the world through games. Mobile and touch screens are revolutionizing gaming. Our opportunity is to make mobile gaming truly social by offering people new, fun ways to meet, play and connect. By reducing our cost structure today we will offer our teams the runway they need to take risks and develop these breakthrough new social experiences.

Because we’re making these moves proactively and from a position of financial strength, we can take care of laid off employees. We’re offering generous severance packages that reflect our appreciation for all of their work and we hope this will provide a foundation as they pursue their next professional steps.

Although these are hard decisions, I’m confident that our strategy of building leading franchises and supporting them with the largest network is the right one for the long term. I’m encouraged by our recent progress. Running With Friends is a great example of the quality player experience we can deliver, already receiving an average 4.5 app star rating from 22,000 players in less than one month after launching. Our FarmVille franchise teams continue to innovate and deliver ground breaking new social experiences like County Fair which, despite only being available on the web, is engaging 39 million monthly players.

I want to thank every one of you for the spirit, creativity and energy that you’ve invested in Zynga. You’ve reintroduced a generation of people to gaming and through these games offered them new ways to connect with their families, make new friends and even sometimes find love.

Everyone will be affected by these changes and I’m sure there will be many follow up questions to this email. If you have specific questions relating to your project or team, please talk to your manager. For any other feedback or thoughts feel free to email me directly.

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Comments

    Maybe they might have to come up with original games for a change instead of stealing from other developers?

    Wait, haha, no. That'll never happen.

    I feel sad for the people losing jobs, but I hate any game that puts up purchasable currency that barely buys anything.

    I love how the aholes at the top want to 'soften' the blow of mass sackings by saying it's a sad day and speaking of those thrown off the financial cliff to save themselves as family.

    Zynga opitimise everything wrong with micro trasaction gaming and it was inevitable they'd end up biting off more than they can chew.

    Rest assured along with this heart breaking act of self preservation for the company, they'll seek to up the ante on screwing the gamer as well to get back more.

    Hey, at least there's generous severance packages. Too often the news is "studio goes bust, employees get nothing"

    how the hell did Zynga get so big as to have almost 3000 staff? Unless when they continuously bought developers they kept the staff on, even after the games got turned into the mobile gaming equivalent of myspace

      Creating colour packs for Draw Something is serious business yo!

      This was exactly the same thought I had when I read that 520 people was only 18% of their total staff.
      There's no way in hell that the productive output of the company is indicative of 3000 people worth of work. It would appear the guys at the top have been blinded by the sheer deluge of cash at the beginning. Gotta love the "casual gamer" crowd for predictable results huh? :p

    I do not know how much these people were earning, but, I guess that the company is going to save some $30 + million dollars in salaries alone.

    Can they make any headway with only 2, 500 employees left ??.
    Or perhaps they will need us to help them?

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