Zynga Inc (NASDAQ:ZNGA) has reported that they are going to reduce their workforce by 18%. Zynga’s stock price dropped 11.76% to $3 and was halted. At their peak, Zynga was trading at about $14.69 in March 2012.
“None of us ever expected to face a day like today, especially when so much of our culture has been about growth. But I think we all know this is necessary to move forward. The scale that served us so well in building and delivering the leading social gaming service on the Web is now making it hard to successfully lead across mobile and multiplatform, which is where social games are going to be played,” said Zynga CEO Mark Pincus.
The layoffs will affect 520 employees and is expected to help cut $80 million in terms of staff costs. Zynga is going to also shut down their New York City, Dallas, and Los Angeles game development studios.
“These moves, while hard to face today, represent a proactive commitment to our mission of connecting the world through games. Mobile and touch screens are revolutionizing gaming. Our opportunity is to make mobile gaming truly social by offering people new, fun ways to meet, play and connect. By reducing our cost structure today we will offer our teams the runway they need to take risks and develop these breakthrough new social experiences,” Pincus added.