Team membersMateo Fadul Gonzalez

Rafael NavarroDomenic Millen

Aman MehraSiriorn Vichaiwatanapanich

Nabeeha Qazi

• Company Overview• Zynga’s Industry Position• Revenue Composition • Company Value Chain Evolution• Financial Analysis• Strategy Analysis• Zynga’s Future Prospects

Agenda

• Created in January 2007 and based in San Francisco, California

• The world’s leading provider of social game services

• Social Networks dependent (i.e. Facebook), also Mobile and Zynga.com

• Social games & internet gaming pioneer

• Leadership position: investment in their people, content, brand, technology and infrastructure

• Connect the world through games

Overview

Profit PoolProfit pool largely dominated by Retailers and Software developers

Zynga’s Industry Position• Develops its own

content and software

• Offer games through online & mobile platforms

• Use of existing infrastructure (PC & social websites)

• Huge savings (+ Profit)

Revenue Stream

Online Gaming (89%) Advertising(11%)

• Consumable Virtual Goods (energy)• Durable Virtual Goods (tractors)

30%70%

Geographical Distribution

Revenue Stream

• Zynga top three games accounts for 55% of Revenues, of the remaining 45%, no single accounts for more than 10%

55%

Timeline

Company started

First sale of virtual goods

Aquisition of YoVille

First 3rd party in-game advertising

IPO Launched Draw Something

Real-money gambling

Expand API to increase game penetration

Texas Holdem

Expanded virtual goods concept to other games

Facebook notific-ations

Large rollout of mobile games

Large scale in-game advertising

Slashed workforce

Application program-ming interface (API)

Expand real-money gambling business

Launched Farmville

Agreement with Facebook signed

Facebook credits

Agreement with Facebook revised

Zynga with Friends

2007 2008 2009 2010 2011 2012 2013 2014 2015

Financial Performance

2009 2010 2011 2012 -

200,000.00

400,000.00

600,000.00

800,000.00

1,000,000.00

1,200,000.00

1,400,000.00

Online gameAdvertisingTotal Revenue

570%

85%

7%

-36% 226%84%

Revenue Growth (in thousands $)

Financial Ratios

2009 2010 2011 2012

-50%

-40%

-30%

-20%

-10%

0%

10%

-43%

5%

-35%

-16%

Profit margin

Financial Ratios

2009 2010 2011 2012 -

0.20

0.40

0.60

0.80

1.00

1.20 1.08

0.57

0.30 0.29

Debt Ratio

Financial Ratios

2009 2010 2011 2012

ROA -0.20406570651502 0.0250725346314665

-0.16065668353832

8

-0.08129735436591

73

ROE 2.45935375733309 0.0578476405752621

-0.23109859225773

2

-0.11473440470927

7

-25.00%

25.00%

75.00%

125.00%

175.00%

225.00%

275.00%

ROA & ROE

Financial Evaluation

ZNGA DNACF EAMarket Cap: 2.76B 3.43B 5.61BEmployees: 3,058 1,810 9,200Revenue (ttm): 1.28B 2.45B 3.96BGross Margin (ttm): 73% 74% 64%EBITDA (ttm): 54.00M 1.05B 393.00MOperating Margin (ttm): -7% 40% 4%Net Income (ttm): -209.45M 561.80M 175.00MNet Profit Margin : -16% 23% 4%EPS (ttm): -0.28 4.02 0.55P/ E (ttm): N/A 6.33 34.17PEG (5 yr expected): -3.35 N/A 1.43P/ S (ttm): 2.16 1.39 1.41

Compare to 2 main competitors:

ZNGA = Zynga, Inc.DNACF = DeNA Co., Ltd.EA = Electronic Arts Inc.

Industry Future Prospects

Mobile games becoming popular

Growing competitionfrom US & Intl. firms

Facebook opening up to more game developers

Demand for sophisticated games driving up costs

Zynga’s Future Prospects

Established customers (players) base

Reduced dependence on Facebook

Constant adaptations/Innovations

Core mgt. team is not the same

Reduced R&D expenses

Business integration issues

Zynga’s Future Prospects

Industry Attractiveness

High Medium Low

Med

ium

Low

Hig

h

Busi

ness

Pos

ition

Zynga

Thank You...Q&A