Earnings Results: Zynga stock rises as results come in light while company awaits acquisition by Take-Two

As with its earnings report back in February, Zynga will not hold a conference call with analysts or provide an outlook because its pending acquisition by Take-Two Interactive Software Inc. 
TTWO,
-7.09%
is expected to close by the end of June, while some analysts expect late May.

Zynga reported a first-quarter loss of $24.5 million, or 2 cents a share, compared with a loss of $23 million, or 2 cents a share, in the year-ago period.

Revenue rose to $691.2 million from $680.3 million in the year-ago quarter, while bookings declined to $694.9 million from $719.5 million a year ago.

Analysts surveyed by FactSet had forecast a loss of a penny a share on revenue of $736.1 million and bookings of $740.6 million.

The company also reported average mobile daily active users increased by 3% to 40 million from a year ago.

“We started off 2022 with a strong quarterly performance, achieving our highest ever Q1 advertising revenue and bookings led by our hyper-casual portfolio,” Zynga Chief Executive Frank Gibeau said in a statement.

While online gaming revenue slipped to $537.7 million from $557 million a year ago, revenue of Zynga’s fastest-growing segment, built-in game ad revenue, rose to $153.5 million from $123.3 million in the year-ago period. One of the things that Zynga pitches to its advertisers is so -called “watch to earn” ads, where players earn in-game currency or energy for watching the ad to completion.

Back in November, Zynga had forecast “low double-digit” growth for 2022, driven by its live services and full-year contributions of games like “Farmville 3,” which was recently released, “Golf Rival” from its recent acquisition of Beijing-based StarLark, and from Rollic, the Istanbul-based hyper-casual games publisher in which it acquired an 80% stake.