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October 24, 2012

Zynga to lay off 5% of workforce

The company also plans to close its Boston studio

By CBR Staff Writer

Social gaming company Zynga is planning on reducing its full-time workforce by about 5%, besides closing some of its studios.

The company plans to close its Boston studio and is proposing to close the Zynga Japan and UK studios, as well as cuts to its studio in Austin, Texas, US.

Zynga also said that it will close 13 older games and reduce investment in the game, The Ville, which was launched in late June.

The company, which runs 18 studios worldwide, reported having 2,916 employees as of 31 March 2012.

Zynga chief executive Mark Pincus said in a note to employees published online that the company does not take these decisions lightly.

"This is the most painful part of an overall cost reduction plan that also includes significant cuts in spending on data hosting, advertising and outside services, primarily contractors," Pincus said.

Earlier this month, Zynga said that it expects to report a net loss of between $90m and $105m for the third quarter and revenue to range from $300m to $305m.

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In August this year, Zynga’s COO and director John Schappert had resigned from both positions.

In September this year, Zynga’s chief marketing and revenue officer, Jeff Karp and chief technical officer, Allan Leinwand had resigned from the company, in a latest exodus of top level executives from the beleaguered company.

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