UNITED STATES SECURITIES and EXCHANGE COMMISSION Washington, D.C
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UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 August 6, 2015 Date of Report (Date of earliest event reported) Zynga Inc. (Exact name of registrant as specified in its charter) Delaware 001-35375 42-1733483 (State or other jurisdiction of (Commission (I.R.S. employer incorporation or organization) File No.) identification number) 699 Eighth Street San Francisco, CA 94103 (Address of principal executive offices, including zip code) (855) 449-9642 (Registrant’s telephone number, including area code) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligations of the registrant under any of the following provisions: ¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) ¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) ¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) ¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) Item 2.02 Results of Operations and Financial Condition On August 6, 2015, the Company issued a press release announcing its financial results for the quarter ended June 30, 2015. A copy of the press release is furnished as Exhibit 99.1 to this Current Report and is incorporated herein by reference. The information furnished in Item 2.02 of this Form 8-K, including Exhibit 99.1 attached hereto, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference into any other filing under the Securities Act of 1933, as amended (the “Securities Act”) or the Exchange Act, except as expressly set forth by specific reference in such a filing. Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. Election of Directors On August 6, 2015, the Board of Directors (the “Board”) of the Company elected, upon the recommendation of the Nominating and Corporate Governance Committee of the Board (the “Nominating Committee”), Frank Gibeau to serve as a member of the Board until his successor is duly elected and qualified, or until his earlier death, resignation or removal. Effective August 6, 2015, the size of the Board will be increased from seven (7) to eight (8) directors to accommodate Mr. Gibeau’s election to the Board. In accordance with the Company’s current program for compensation of non-employee directors which was filed as Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q filed on November 7, 2014 and incorporated by reference herein, Mr. Gibeau will be entitled to receive compensation for his service as a member of the Board and committees thereof. There are no arrangements or understandings between Mr. Gibeau and any other persons pursuant to which he was elected as a director of the Company. There are no family relationships between Mr. Gibeau and any director, executive officer, or any person nominated or chosen by the Company to become a director or executive officer. Mr. Gibeau is not a party to any current or proposed transaction with the Company for which disclosure is required under Item 404(a) of Regulation S-K. The Company has also entered into its standard form of indemnification agreement with Mr. Gibeau. Item 9.01 Financial Statements and Exhibits. (d) The following exhibit is filed with this report on Form 8-K: Exhibit Number Description 99.1 Press release issued by Zynga Inc., dated August 6, 2015. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. Zynga Inc. Date: August 6, 2015 By: /s/ David Lee David Lee Chief Financial Officer INDEX TO EXHIBITS Exhibit Number Description 99.1 Press release issued by Zynga Inc., dated August 6, 2015. EXHIBIT 99.1 Press Release ZYNGA ANNOUNCES SECOND QUARTER 2015 FINANCIAL RESULTS DELIVERS $174M IN BOOKINGS AND $1M IN ADJUSTED EBITDA LAUNCHES TWO NEW GAMES WORLDWIDE: EMPIRES & ALLIES AND FARMVILLE: HARVEST SWAP APPOINTS FRANK GIBEAU TO BOARD OF DIRECTORS SAN FRANCISCO – August 6, 2015 – Zynga Inc. (NASDAQ: ZNGA), a leading social game developer, today announced financial results for the second quarter ended June 30, 2015. In addition to today’s press release, a copy of our Q2 2015 Quarterly Earnings Letter, which outlines our Q2 2015 financial results and business outlook, is available on our website at http://investor.zynga.com. Zynga management will host a live Q&A session at 2:00 p.m. Pacific Time (5:00 p.m. Eastern Time) today, August 6, to discuss the Company’s Q2 performance and business outlook. Questions may be asked on the call or submitted in advance via email to [email protected], and the company will respond to as many questions as possible. “Our teams have been executing well and delivered strong Q2 results while also making significant progress against our best growth opportunities. In terms of our core franchises – FarmVille, Slots, Poker and Words With Friends – we beat our expectations and the teams did a good job delivering value for our players. We also launched Empires & Allies and FarmVille: Harvest Swap in Q2, and are excited for the upcoming launches of Dawn of Titans, CSR2 and our new Slots game later this year,” said Mark Pincus, CEO and Chairman, Zynga. “In terms of our people, we’ve made progress in moving to smaller game teams. We believe this will allow them to be more nimble, creative and innovative. We’re also continuing to add talent and leadership with our appointment today of Frank Gibeau, one of the top strategists in mobile gaming, to our Board of Directors.” Pincus continued, “We believe that social gaming has the opportunity to be as important a medium in people’s lives as social networking and social media. We’re excited to deliver on that promise by getting back to our entrepreneurial roots, innovating on game mechanics and leveraging world class data and analytics to accelerate our path. Finally, I want to thank our employees for their deep commitment and focus. Our teams have worked hard to lay the mobile- first foundation necessary to lead in social gaming. We look forward to building on that progress for the remainder of 2015 and beyond.” “We generated $174 million in total bookings, an increase of 4% sequentially and above the top end of our guidance range. Our sequential increase in bookings was driven in part by our growth in mobile, which was up 8% sequentially and 30% year-over-year,” said David Lee, CFO, Zynga. “The biggest drivers of our mobile growth were our Slots franchise, which grew 32% sequentially, and the launches of Empires & Allies and FarmVille: Harvest Swap. In terms of adjusted EBITDA, our result for Q2 was $1 million, above the high end of our guidance range. We’re particularly pleased to deliver these results even as we continue to make substantial investments in new game development, marketing for new game launches and core infrastructure in data and analytics.” Financial Results • Bookings of $174 million; above high end of the guidance range • Adjusted EBITDA of $1 million; above the high end of the guidance range • Mobile bookings now represent 66% of overall bookings at $115 million; up 30% year-over-year • Advertising bookings, excluding licensing and developer payments, up 44% year-over-year • $1.1 billion in cash and marketable securities • Implemented $100 million cost reduction plan • Positive free cash flow inclusive of investment in game development, marketing for new launches and infrastructure 1 Product Highlights • Our Slots franchise –Wizard of Oz Slots and Hit It Rich! Slots – grew bookings 32% sequentially and recently secured a multiyear agreement with Warner Bros. Interactive Entertainment to license the Willy Wonka and the Chocolate Factory brand • Empires & Allies launched worldwide with a 4.5 Apple App Store star rating and strong engagement with players averaging 5 play sessions daily totaling 38 minutes; at $0.26, Q2 Average Daily Bookings per Average DAU (ABPU) nearly 3 times the company’s ABPU in Q2 • FarmVille: Harvest Swap launched worldwide with a 4.5 Apple App Store Star rating and strong player retention Player Metrics • Average DAUs – 21 million; down 23% year-over-year and down 15% sequentially • Average MAUs – 83 million; down 32% year-over-year and down 18% sequentially • Average Daily Bookings per Average DAUs (ABPU) – $0.091; up 29% year-over-year and up 21% sequentially • Payer conversion (excluding NaturalMotion) – 1.6%; down 17% year-over-year and up 5% sequentially Financial Highlights (in thousands, except per share data) Three Months Ended Six Months Ended June 30, June 30, June 30, June 30, 2015 2014 2015 2014 GAAP Results Revenue $199,918 $153,232 $383,211 $ 321,252 Net loss $ (26,868) $ (62,533) $ (73,364) $(123,716) Diluted net loss per share $ (0.03) $ (0.07) $ (0.08) $ (0.14) Non-GAAP Results Bookings $174,462 $175,102 $341,872 $ 336,460 Adjusted EBITDA $ 963 $ 14,491 $ 3,056 $ 28,337 Non-GAAP net income (loss) $ (7,578) $ 2,808 $ (14,291) $ (3,450) Non-GAAP earnings (loss) per share $ (0.01) $ 0.00 $ (0.02) $ 0.00 Appoints Frank Gibeau to Board of Directors Today, Zynga announced that Frank Gibeau, former Executive Vice President at Electronic Arts Inc., has joined the company’s Board of Directors.