Zynga Changes Course on U.S. Online Gambling

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Zynga Changes Course on U.S. Online GamblingZynga stunned the online gaming world this week by relinquishing plans to pursue online gambling in the U.S.

The unexpected move is contrary to Zynga’s recent applications for numerous licenses in the U.S.

The decision to back away from real money online gaming in the United States, we’re told, was made by the board and the entire executive team.

Nonetheless, the news had a swift and sudden effect on Zynga’s shares as they plummeted more than 17 percent Friday morning.

Zynga’s Chief Operating Officer David Ko says the company needs to regain its focus on free-to-play social games and its core demographic.

Rather than creating social games for the desktop, Zynga has adopted a so-called “mobile first” strategy.

To date, mobile has accounted for 27 percent of Zynga’s bookings in the second quarter.  Compared to a year ago, however, Zynga’s monthly user base has fallen to 187 million – down 39 percent.

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