Zynga seems to be hit with the worst luck, it seems. It appears that Zynga has announced layoffs on nearly 100+ people within multiple departments within the company. Zynga has announced that a major scale down of their game The Ville and has pulled the plug on another IP called Zynga Bingo and laid off all of the team that was working on the game.
Another horrible part of this is that the Boston studio has closed completely. The Boston division was working on title called: Indiana Jones Adventure World and a Chicago based office may also be into trouble, but there is no confirmation.
What makes matters even worse for Zynga is that these announcements were made during the Apple press conference earlier today and employees were told that they only had TWO hours to clear their stuff and leave the confines of their office. CEO Marc Pincus gave the following statement:
These reductions, along with our ongoing efforts to implement more stringent budget and resource allocation around new games and partner projects, will improve our profitability and allow us to reinvest in great games and our Zynga network on web and mobile,
This news is just on the heels of a Q3 financial call where Zynga CEO Marc Pincus will be announcing poor earning in the last year. Gamasutra was lucky enough to obtain the internal memo and it says the following:
Earlier today we initiated a number of changes to streamline our operations, focus our resources on our most strategic opportunities, and invest in our future. We waited to share this news with all of you until we had first spoken with the groups impacted.
As part of these changes, we’ve had to make some tough decisions around products, teams and people. I want to fill you in on what’s happened and address any concerns you may have.
Here are the most important details.
We are sunsetting 13 older games and we’re also significantly reducing our investment inThe Ville.
We are closing the Zynga Boston studio and proposing closures of the Zynga Japan and UK studios. Additionally, we are reducing staffing levels in our Austin studio. All of these represent terrific entrepreneurial teams, which make this decision so difficult.
In addition to these studios, we are also making a small number of partner team reductions.
In all, we will unfortunately be parting ways with approximately 5% of our full time workforce. We don’t take these decisions lightly as we recognize the impact to our colleagues and friends who have been on this journey with us. We appreciate their amazing contributions and will miss them.
This is the most painful part of an overall cost reduction plan that also includes significant cuts in spending on data hosting, advertising and outside services, primarily contractors.
These reductions, along with our ongoing efforts to implement more stringent budget and resource allocation around new games and partner projects, will improve our profitability and allow us to reinvest in great games and our Zynga network on web and mobile.
Zynga made social gaming and play a worldwide phenomenon, and we remain the industry leader. Our success has come from our dedication to a simple and powerful proposition – that play is not just something people do to pass time, it’s a core need for every person and culture.
We will all be discussing these difficult changes more with our teams and as a company. Tomorrow, Dave and I will be hosting a post-earnings webcast (details to follow) and next week we will be discussing our broader vision and strategy during our quarterly all-hands meeting. I’m confident this puts us on the right path to deliver on the promise of social gaming and make Zynga into an internet treasure.
If you have any immediate questions, I hope you will talk directly with your manager, Colleen, or me.
I look forward to talking with you tomorrow.
As you can see, there could be more closures in the future for their UK and their Japan studios. This all seems to a boiling point as the company continues to make cuts and their loss of money is now making the studio seem on it’s last legs. Having lost a valuable workforce could be a demise in the making. Only time will tell.
Huge thanks Gamasutra for all of the information.