Zynga Will get Into Blockchain, TikTok Gaming Amid Document Q3 Income

(Image courtesy of Zynga)

Mobile game giant Zynga ZNGA hired its first executive to oversee a new blockchain-based games division, posted its first title on social media giant TikTok, and reported record third-quarter revenue, up from the same period in 2020 has increased by 40 percent.

The company raised its guidance for the full year, predicting it will have a record annual performance and the largest mobile audience ever. Although the company is getting into cross-platform gaming, it makes mostly money in ad-based web and mobile games, led by two # 1 “Hypercasual” releases developed through the 2020 acquisition of Rollic.

“Overall, we are entering the year 2022 with strong momentum among the most important growth drivers and aiming for sales growth in the low double-digit range with an improved net cash flow,” said a letter to investors. “In the next few years we also expect to further expand the operating margins in the direction of our long-term goal.”

The company reported revenue of $ 705 million, up 40 percent from the same quarter in 2020 thanks to strong advertising performance. Total bookings hit a company record of $ 668 million, up 6 percent from 2020 .

The average daily active mobile users increased by 21 percent to 38 million, the monthly active users by 120 percent to 183 million. The company also reported a loss of $ 42 million on an adjusted EBITDA of $ 197 million. Both numbers reflect a significant improvement over the results for the third quarter of 2020.

Alongside financial results for the third quarter, Zynga released a barrage of news including:

  • The hiring of Matt Wolf as VP of Blockchain Gaming as the company tries to forestall a hot trend in gaming, especially in so-called “play-to-earn” titles. One of these titles, Axie Infinity, has already attracted more than 2 million users, particularly in Asia. Bernard Kim, the publisher’s president, said, “Playing to earn is going to be part of the bigger (blockchain) strategy. This is the key element in terms of incentivizing people to get involved on a platform and to invest their time and energy in a platform. We want to be where the players are, where they are committed. We cater to your needs and wishes. So that will be part of it. ”Wolf was previously founder / CEO of the digital agency D20 and VP of Entertainment and Ventures at Coca-Cola. Kim declined to provide a schedule for creating blockchain-based titles.
  • The release of the music and dance track Disco Loco 3D exclusively on TikTok. The endless runner title is Zynga’s first on ByteDance’s hugely popular short-form video platform, but only the latest in a line of Zynga games developed for Snapchat and other social media platforms. The company described Disco Loco as “the first HTML5 game developed for the platform by an official partner of a game studio”.
  • Last week the company launched FarmVille 3, the first update to the iconic franchise in half a decade. Kim said the initial response has been strong in both the iOS and Android app stores, and has so far received more than 3,000 reviews averaging 4.6 stars. The game runs on Apple and Android mobile platforms, but also on Apple’s home-brewed M1 chips in its computers, which are based on the same architecture as its iPhones and iPads.
  • Zynga is integrating another new addition, Star Lark, the maker of Golf Rival who is encouraging consideration to develop similar arcade-style games in other sports, Kim said, although he warned it was way too early, sports or other details to be stated on spin-offs.
  • Earlier this year, Zynga bought ad tech company Chartboost, in part to ease Apple’s new AAPL restrictions on the use of third-party data. The company is expanding its mobile advertising platform based on Chartboost technology.

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