Casual game maker ends trading down 5 percent to $9.50 after initial jump gave way to daylong slide.
Tech industry IPOs have proven to be hostile territory this year, with companies like LinkedIn, Groupon, and Pandora all trading significantly lower than their opening valuations. Today, casual gaming kingpin Zynga made its much-anticipated debut on the NASDAQ, and with trading now closed, the company has joined the IPO losers crowd.
Following its first day of trading, Zynga finished at $9.50 per share, a 5 percent decline on its $10 opening price. The stock fluctuated wildly out of the gate, rising to as much as $11.50 before bottoming out at $9.00 in the early afternoon.
Yesterday, Zynga announced that it would begin trading on the NASDAQ today, pricing 100 million shares at $10 per. That figure came in on the high side of company expectations, after Zynga said in a Securities and Exchange Commission filing earlier this year that the IPO price would be set between $8.50 and $10.
"Our approach has always been to focus on the longterm," Zynga CEO Mark Pincus told Reuters regarding the drop. "We thought this was the right time to go public. We're going to focus on the products and business results we deliver in the next four to eight quarters and hope the stock market values and appreciates that as they see us deliver it."
Zynga has faced substantial criticism going into its IPO. Analysts and industry watchers have noted the company's over-reliance on the Facebook platform, which plays host to some 95 percent of traffic for Zynga's games. Four of the top five games on Facebook are from Zynga, according to AppData, with the sole exception being EA's The Sims Social.
The company's growth prospects have also been questioned, as the company struggles to increase profits while also building on its already-substantial player base. Zynga attracts some 227 million monthly and 54 million daily active users, with top games such as CityVille, FarmVille, CastleVille, and Texas HoldEm Poker.
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