Zynga shares fell 13% below their IPO price this week, as the online games maker went into its second trading session since its IPO. The slide comes as investors worried about the online game publisher’s growth prospects. The fall following the initial public offering at $10 per share on Thursday, mirrors the double-digit stock decline […]
Zynga shares fell 13% below their IPO price this week, as the online games maker went into its second trading session since its IPO. The slide comes as investors worried about the online game publisher’s growth prospects. The fall following the initial public offering at $10 per share on Thursday, mirrors the double-digit stock decline of Japanese game maker Nexon since it went public last Wednesday in Tokyo.
With these latest losses, Zynga has a market value of $7.8 billion, down from $8.9 billion when it went public.
Investors are now concerned at the company’s heavy dependence on leading social networking website Facebook and slowing revenue growth in recent quarters.
Zynga makes money on Facebook by selling virtual items such as jewelry and poker chips in its games such as “FarmVille” and “CityVille.”
Zynga’s stock performance could hurt other private companies waiting to go public, such as Yelp and even Facebook, analysts said.
