Zynga's plunge dings Facebook
The fallout from trimmed earnings and revenue forecasts spreads, and an analyst cuts his FB price target.
Zynga (ZNGA) shares fell roughly 20% to a new low Friday after the company offered bleak news about its third quarter and lowered its full-year forecast.
Facebook (FB) shares dropped as well after Forbes reported J.P. Morgan analyst Doug Anmuth trimmed his target price on Facebook shares to $28 from $30 because of Zynga's troubles. Anmuth notes that Zynga accounted for 54% of Facebook’s payments revenue in Q2. He now projects 2013 Facebook payments revenue of $582 million, down from a previous forecast of $797 million. That would be a 28% year-over-year drop.
Zynga said Thursday that it will likely report a net loss of 12 to 14 cents a share for the quarter. Excluding one-time items, the company said it would likely break even or lose a penny per share. The online gaming company also said revenue would come in at between $300 million to $305 million.
The company will report its full quarterly results on Oct. 24. For the full year, Zynga lowered its bookings projection to between $1.085 billion and $1.1 billion. The previous projection was between $1.15 billion to $1.225 billion.
And the company's acquisition of OMGPOP has pretty much turned out to be a bust. Zynga announced a write-down related to the acquisition in the neighborhood of $85 million to $95 million. It reportedly paid $200 million for the app developer earlier this year.
Reported with MSN Money's Kim Peterson.
More from Top Stocks
Copyright © 2014 Microsoft. All rights reserved.
Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.
Start investing in technology companies with help from financial writers and experts who know the industry best. Learn what to look for in a technology company to make the right investment decisions.
Starting next summer, every smartphone sold in California must have an anti-theft device. But many users don't have to wait to safeguard their phones.
VIDEO ON MSN MONEY
MUST-SEE ON MSN
- Video: Easy DIY smoked meats at home
A charcuterie master shares his process for cold-smoking meat at home.
- Jetpacks about to go mainstream
- Weird things covered by home insurance
- Bing: 70 percent of adults report 'digital eye strain'