Zynga 2013 Annual Report Download - page 45

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Table of Contents
deferred revenue and then recognize that revenue over the estimated average payer life or as virtual goods are consumed. Advertising sales that
consist of certain branded virtual goods and sponsorships are also deferred and recognized over the estimated average life of the branded virtual
good, similar to online game revenue. For additional discussion of the estimated average life of durable virtual goods, see the section titled
“Management’s Discussion and Analysis of Financial Condition and Results of Operations—Revenue Recognition” elsewhere in this Annual
Report on Form 10-K.
We use bookings to evaluate the results of our operations, generate future operating plans and assess the performance of our company.
While we believe that this non-GAAP financial measure is useful in evaluating our business, this information should be considered as
supplemental in nature and is not meant as a substitute for revenue recognized in accordance with GAAP. In addition, other companies,
including companies in our industry, may calculate bookings differently or not at all, which reduces its usefulness as a comparative measure.
The following table is a reconciliation of revenue to bookings for each of the periods presented:
Adjusted EBITDA
To provide investors with additional information about our financial results, we disclose within this Annual Report on Form 10-K adjusted
EBITDA, a non-GAAP financial measure. We have provided below a reconciliation between adjusted EBITDA and net income (loss), the most
directly comparable GAAP financial measure.
We have included adjusted EBITDA in this Annual Report on Form 10-K because it is a key measure we use to evaluate our financial and
operating performance, generate future operating plans and make strategic decisions for the allocation of capital. Accordingly, we believe that
adjusted EBITDA provides useful information to investors and others in understanding and evaluating our operating results in the same manner
as our management and board of directors. While we believe that this non-GAAP financial measure is useful in evaluating our business, this
information should be considered as supplemental in nature and is not meant as a substitute for the related financial information prepared in
accordance with U.S. GAAP.
41
Year Ended December 31,
2013
2012
2011
2010
2009
(in thousands)
Reconciliation of Revenue to Bookings:
Revenue
$
873,266
$
1,281,267
$
1,140,100
$
597,459
$
121,467
Change in deferred revenue
(157,090
)
(133,640
)
15,409
241,437
206,603
Bookings
$
716,176
$
1,147,627
$
1,155,509
$
838,896
$
328,070