On the Call: Zynga CEO Don Mattrick

Associated Press

SAN FRANCISCO (AP) -- Zynga Inc. has dramatically reduced its payroll during the past nine months in an effort to offset its losses. The latest cuts made by the digital game maker last month jettisoned 520 employees, or 18 percent of the workforce.

Some analysts believe newly hired CEO Don Mattrick should trim even more as he tries to engineer a turnaround. That's because Zynga still employs 2,360 people, far more than rivals such as King.com that have been making more popular games with far fewer workers.

Mattrick defended the current size of Zynga's workforce in response to a question during the company's conference call about its second-quarter results.

QUESTION: You just mentioned you currently have 2,300 employees and from what has been reported, the company King.com has about 400 employees. So, I'm wondering, given that they seem to be making more money now than Zynga, why is one of the first moves not to cut the company in half or in a quarter, meaning a substantially greater contraction of the employee base than what's been previously announced?

ANSWER: Imagine if we can start getting the leverage out of our 2,300 people that King is getting out of their 400 people? Would we be driving better financial results? I believe we would.

And I think it's an opportunity for us to look at the challenge of what are we creating, how are we effectively using the scale that we built as a company. Because this market is going to expand. It is going to get more competitive. And people are going to be measured about where they position themselves in the charts (of top games), the quality of the teams and the long-term sustainability. So, while we have got a lot of work to do, I see a lot of opportunity in having the collection of people that we have assembled.