Zynga 2011 Annual Report Download - page 37

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Table of Contents
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
You should read the following discussion of our financial condition and results of operations in conjunction with the consolidated financial
statements and the related notes included elsewhere in this Form 10-K. The following discussion contains forward-looking statements that
reflect our plans, estimates and beliefs. Our actual results could differ materially from those discussed in the forward-looking statements.
Factors that could cause or contribute to these differences include those discussed below and elsewhere in this Form 10
-K, particularly in
“Special Note Regarding Forward-Looking Statements” and “Risk Factors.”
Overview
We are the world’s leading provider of social game services with 240 million average MAUs in over 175 countries. We have launched the
most successful social games in the industry in each of the last three years and generated over $1.85 billion in cumulative revenue and over
$2.35 billion in cumulative bookings since our inception in 2007. Our games are accessible on Facebook, other social networks and mobile
platforms to players worldwide, wherever and whenever they want. All of our games are free to play, and we generate revenue through the in-
game sale of virtual goods and advertising.
We are a pioneer and innovator of social games and a leader in making play a core activity on the Internet. We believe our leadership
position in social games is the result of our significant investment in our people, content, brand, technology and infrastructure. Highlights in our
history include:
33
•
In April 2007, we began operations and by the end of 2008 had launched several games, including
Zynga Poker
in July 2007 and
Mafia Wars
in June 2008 on multiple platforms, including Facebook and Myspace. In addition, in June 2008, we acquired the
YoVille
game in order to expand our game portfolio. As of December 31, 2008, we had 157 employees.
•
In June 2009, we launched FarmVille
, which quickly became the most popular social game on Facebook. In the second half of 2009,
we launched several other games, including Café World in September 2009. In the fourth quarter of 2009, we achieved $144.6
million in bookings. As of December 31, 2009, we had 576 employees.
•
In 2010, we saw continued growth from existing games and new game launches. We launched FrontierVille in June 2010 and
CityVille in December 2010. During 2010, in order to enhance our product portfolio and game development capabilities around the
world, we acquired several companies, including Newtoy, Inc., the creator of the mobile game Words with Friends . In the fourth
quarter of 2010, we achieved $243.5 million in bookings. As of December 31, 2010, we had 1,483 employees.
•
In 2010, we entered into an addendum with Facebook that modified Facebook
’
s standard terms and conditions for game developers
as they apply to us and that govern the promotion, distribution and operation of our games on Facebook. In July 2010, we began
migrating to Facebook Credits, and by April 2011, we had migrated all of our games on Facebook to Facebook Credits.
•
In the first quarter of 2011, we released
FarmVille English Countryside
, an expansion of
FarmVille
. We also launched
Words with
Friends
on the Google Android platform in the first quarter.
•
In the second quarter of 2011, we launched
Empires & Allies
, our first strategy combat game, and
Hanging with Friends
, a mobile
game that was developed in our Zynga with Friends studio.
•
In the third quarter of 2011, we launched Indiana Jones Adventure World and released Words with Friends on Facebook and
achieved $287.7 million in bookings. As of September 30, 2011, we had 2,789 employees.
•
In the fourth quarter of 2011, we launched CastleVille and achieved $306.5 million in bookings. As of December 31, 2011, we had
2,846 employees.
TM