Inc said it expects a full-year profit after reporting better-than-expected third-quarter results due to cost-cutting and a renewed focus on mobile games and core franchises like "Zynga Poker" that lifted shares 13 percent.
The creator of casual game "Farmville" said on Thursday it expects to make a slim profit for 2013 before taking into account exceptional items such as restructuring charges.
The game publisher, once among the hottest tech companies with rapid revenue growth from popular Facebook-based games, was caught flat-footed as the games industry saw a boom in mobile games. It has since sought to regain its financial footing by transitioning to smartphones and tablet titles, the increasingly preferred format for casual gamers.
Longer term, investors however are keen to see Zynga lure users back to its games. Daily active users had dropped to 30 million in third quarter from 60 million in the same period a year ago, the company said.
In July, Zynga recruited the former head of Microsoft Corp's Xbox business, Don Mattrick, to replace co-founder Mark Pincus as CEO. Mattrick has since been busy managing layoffs, trimming costs and reviewing the company's product pipeline.
(Also see: Microsoft Xbox head Don Mattrick named Zynga CEO)
The company recently launched a free-to-play mobile game "CastleVille Legends" for Apple Inc's iOS devices to reinforce its foray into mobile gaming.
Early signs looked promising, Mattrick said on an earnings call with analysts.
"We are getting good insights on monetization that we will be able to leverage as we bring more of our intellectual property to mobile," he said.
On Thursday, Zynga said it hired Clive Downie, an executive who managed the Western operations for Japanese mobile gaming giant DeNA Co Ltd to be its new chief operating officer, further bolstering its in-house mobile expertise.
Shares in Zynga were up at $3.99 in after-hours trading after closing at $3.535 on the Nasdaq on Thursday.
Zynga's non-GAAP revenue fell to $152.1 million from $256 million for the same period a year ago, but surpassed analysts' average estimate of $142.7 million, according to Thomson Reuters I/B/E/S.
It reported a loss of $16.2 million compared with a loss of $361,000 for the same period last year. It reported a net loss per share of 2 cents, while Wall Street expected a 4-cent loss, according to Thomson Reuters I/B/E/S.
The company forecast fourth-quarter revenue in the range of $175 million to $185 million.
© Thomson Reuters 2013