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Zynga surprise: more revenue and real money gambling in UK

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By Noel Young, Correspondent

October 25, 2012 | 3 min read

With good news for Facebook yesterday on its stock price, its games partner Zynga, inventors of FarmVille, also got some cheer after a roller coaster week: Higher revenuues and real money gambling in the UK!

Zynga: New FarmVille game

After the markets closed , Zynga surprised investors and analysts with an earnings report that showed revenue growth.

This following a series of lowered forecasts and announced closures of its offices in England and Boston.

Mark Zuckerberg piled in too. When he said in a conference call that Zynga's revenues on Facebook were down, TheStreet.com headlined the story : “Call the Cops, Mark Zuckerberg Just Killed Zynga.”

In fact what Zuck said was that gaming on Facebook “wasn’t doing as well as I’d like.” Users were playing fewer Zynga games. Zuckerberg said that Zynga made up 7% of its total revenue in the third quarter, down from 10% in the prior quarter.

But not so fast with rumours of Zynga's death!

Analysts had forecast third-quarter revenues of $276 million, but the 3000-employee San Francisco firm easily beat that with revenues totaling $317 million. This resulted in a balanced earnings sheet after excluding one-time costs,said the San Jose Mercury News.

In addition, Zynga announced a partnership with bwin.party Digital Entertainment PLC to offer real-money poker and hundreds of casino-style games in the U.K. during the first half of next year. These games, banned in the United States, are said to be highly profitable.

Also advertising is being looked on as a possible source of Zynga revenue

"People are hoping that there's some life left here," Sterne Agee & Leach analyst Arvind Bhatia told Bloomberg News.

The company's stock jumped in after-hours trading, rising as much as 16 percentto $2.42. Still, Zynga shares are down 75 percent from their $10 public offering price last December.

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