ZNGA advertising revenues up 35% YOY with 21% of revenues from mobile already.
Zynga is a more risky buy than the above two companies as the company is making a major transition after cutting the umbilical cord with Facebook (FB). The stock has been slaughtered after its IPO and is down almost 85% from its peak value. The company has faced problems with monetization and there are concerns on how it will survive without Facebook. However, the recent results have given good signs about its future. The company already gets 21% of its revenues from mobile and its recent introductions like Farmville 2 have been a surprising success. The company is maturing and cutting costs to focus more on profits. The company has shut down nonviable games and studios and is concentrating on fewer higher money making games. The company's rigorous 6 months' testing of Farmville 2 reaped rewards in terms of greater user participation. The company's own network is proving a source of strength and advertising revenues are really starting to ramp up (35% y/y growth in 4Q12).
The company has a massive cash hoard of $1.2 billion which accounts for almost 50% of the company's value. Zynga is not losing money which means that the cash is not going away anytime soon. Its entry into the real money gaming industry has the potential to generate a massive amount of profits, as it already has millions of users playing its Zynga Poker game.
I agree, people always look at the past but don't give any credibility to what a company is doing about the future which is what really matters. Zynga is trying to monetize the mobile space using their nearly 300 million monthly users. This will work as you can see the trend to mobile is already moving and will kick into high gear this quarter and next. Other than uncovered short positions needing to cover nothing has changed. Next Monday Picus will be presenting at the Morgan Stanley conference on Monday