Zynga is hitting the reset button as the San Francisco gaming company on Wednesday announced the immediate return of founder Mark Pincus as chief executive, taking over for Don Mattrick. In his two years with the company, Mattrick was unable to successfully morph Zynga from a social gaming company into a mobile-first gaming firm.
The company rose to fame in the mid-2000s as one of the first developers to successfully create social video games, the most notable of which was "FarmVille." These games were free to play but gamers could enhance their experience by paying for things like items. Zynga's games were played on the desktop through Facebook and their success allowed Zynga to grow quickly and hold an initial public offering in 2011, but the company's success was quickly disrupted as its audience began turning more and more toward games on their smartphones.
Mattrick took over in 2013 to help the company transition into a mobile gaming firm, but under his leadership, company revenue fell to $590 million last year, down from $1.28 billion the year before he took over. Pincus told the New York Times that Mattrick was not fired but rather the two agreed that now was the right time for Pincus to return.
"Now that we are a mobile-first company, it's time to renew our focus on our founding mission to connect the world through games and our vision to make play and social games a mass-market activity," Pincus said in a statement. "I am returning to the company that I love in order to accelerate innovation in the most popular categories like Action Strategy and strengthen our focus on our core areas like Invest and Express."
Since last April, the company's stock has been down more than 36 percent, and investors don't seem too pleased with the latest executive change with stock down more than 10 percent in after-hours trading. Zynga's next quarterly earnings will be released May 7. Following the close of market that day, Zynga will hold a conference call where Pincus will surely be grilled with questions by analysts eager to hear how he plans to right the ship.
As for Mattrick, who was previously with Microsoft and before that Electronics Arts, the now former Zynga CEO said he plans on returning to his home country of Canada "to pursue my next challenge."