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Zynga reports first-quarter fiscal 2013 revenue down 18 percent, net income up

Samit Sarkar (he/him) is Polygon’s deputy managing editor. He has more than 15 years of experience covering video games, movies, television, and technology.

Zynga brought in $263.6 million of revenue, an 18 percent year-over-year drop, during the first quarter of its 2013 fiscal year, the company announced today in an earnings report.

Zynga's fiscal year runs alongside the calendar year, so today's financial report covers the three-month period that ended March 31.

The financial breakdown listed revenue from online games at $229.6 million, a 22 percent year-over-year drop, and advertising revenue at $34 million, a 21 percent jump. The decrease in online game revenue is likely tied to the shrinking user base for Zynga's games — daily active users were down 21 percent from the same period in 2012, monthly active users dropped 13 percent and monthly unique payers decreased 30 percent.

Based on daily active users, Zynga still had three of the top 10 Facebook titles for the quarter — Words with Friends, Zynga Poker and FarmVille 2. The company also launched two new games during the period, Zynga Slots on the web and What's the Phrase on mobile platforms.

The quarter did have at least one highlight: Zynga reported a net income of $4.1 million, a sharp turnaround from the $85.4 million loss it suffered a year ago.

"2013 will continue to be a transition year as we face the challenging environment on the web and invest in developing the leading franchises and network across web and mobile platforms," said Mark Pincus, CEO of Zynga, in an investor release today.

The publisher is investing heavily in real-money gaming — it launched ZyngaPlusPoker and ZyngaPlusCasino in the U.K. earlier this month in a partnership with, an online gambling company. In the investor release, Zynga said, "These offerings are the first step toward realizing Zynga's long-term vision of bringing players the next generation of real money games on multiple platforms in regulated markets."

Zynga is expected to provide further details on its first-quarter earnings in an investor call this afternoon.

Update: During the call, Zynga chief financial officer David Ko said the company doesn't expect real-money games to contribute to its bottom line this year. "We do not believe they [real-money games] will be significant to 2013 results," he said.