Zynga will not pursue online gambling venture

By IVCPOST Staff Reporter

Jul 29, 2013 08:06 AM EDT

Online games developer Zynga announced that it would cancel its plans to penetrate the online gambling industry. This statement came after the company posted a 14% decline in Nasdaq trading last Friday. Investors quickly exited the Farmville developer after the announcement.

"While the company continues to evaluate its real-money gaming products in the UK test, Zynga is making a focused choice not to pursue a license for real-money gaming in the US," said Zynga in a statement.

The Internet games developer's shares closed at US$3.01 after early trading where its stock nosedived to record lows (20% to US$2.81 per share). The figures were provided by Bloomberg.

The company remains optimistic, saying "Shares had surged by nearly 50 percent through Thursday, based on optimism online betting could help Zynga overcome its declining social gaming business."

Almost 40% of the company's clients were lost during the second quarter. This player base reduction caused the company's revenue to decline to as much as 20%, according to analyses by Reuters,

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