Struggling game developer Zynga lays off hundreds

Michael Homnick, TechHive
24 October, 2012
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There may not be as many farmhands available to harvest the crops for struggling Facebook game developer Zynga.

The company—most famous for games like Farmville and Words With Friends—reportedly carried out hundreds of layoffs in the US this morning.

The news broke unceremoniously when former Apple, Sony, and Mint designer Justin Maxwell tweeted during Apple’s press event that more than 100 Zynga employees in Austin, Texas, had arrived at work only to be given two hours to vacate the premises. TechCrunch, which later confirmed Maxwell’s tweet, also reported the company’s Cambridge, Massachusetts office would be closed entirely. There were also an undisclosed number of layoffs at the company’s Chicago office.

The teams let go were responsible for TheVille and Zynga Bingo, according to Maxwell. The former was a just-launched world-building game not unlike The Sims—so similar, in fact, that Sims maker Electronic Arts filed suit in August claiming copyright violations.

After seeing revenues decline rapidly—the company’s stock price has tumbled this year—Zynga has been forced to cut costs in the wake of increased competition and as users gravitate toward mobile platforms.

Zynga was hammered by investors after a disappointing quarterly earnings report in July, which is likely prompting the once-promising startup to trim its workforce.

Zynga reports its latest quarterly earnings Wednesday.

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