Social online and mobile casino revenues help Zynga recovery

Q2-2015 results from the US social gaming group Zynga this week were better than expected, although hardly stellar; the company reported:

* Q2 revenue up 30 percent to almost $200 million;

* Net loss lower at $26.9 million (Q2-2014: loss of $62.5 million);

* Advertising expenditure up 7 percent on the preceding quarter, but 70 percent higher than in Q2-2014;

* In-game sales flat at $174.5 million;

* Mobile sales up 30 percent at $115 million, comprising two-third of total sales;

* Online sales weaker y-o-y by over 30 percent at $59 million;

* Worrying loss of users; average monthly users fell more than 28 percent to one million, although average daily sales per user were up 29 percent at 9.1 US cents. Active monthly user statistics were down 32 percent year-on-year, declining to 83 million, whilst daily active players fell y-o-y by 23 percent to 21 million;

* Disturbing drop in player conversion rates to 1.6 percent (Q2-2014: 17 percent);

* Social casino operations presented a more encouraging picture, with poker delivering 18 percent of all gaming revenue. Overall social casino sales were up 47 percent year-on-year, with slots performing particularly well – up 274 percent. That is likely to continue improving with the introduction of new slots such as Willy Wonka-themed products following Zynga’s deal with Warner Bros and increased output from the 2013 Spooky Cool Labs acquisition;

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