This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Zynga Gambles on the Future

SAN FRANCISCO ( TheStreet) -- Despite Zynga's (ZNGA) recent sharp share price decline, the company is "rolling the dice" on its future: online gambling.

The San Francisco-based social gaming company is exploring the potential online gaming market, according to Mike Gupta, Zynga's vice president of finance and treasurer.

"We think it's an interesting adjacency to what we do in our core business," he said, in an interview with TheStreet. "We also have an interesting asset in Zynga Poker, which is one of the world's largest online game, with over 30 million monthly users."

Reports first surfaced earlier this year that the company would look to enter the online gambling space, as it seeks to diversify revenue outside of social gaming.

Online gambling is still illegal in the United States, but it's legal in other countries, including Britain. Senate Majority Leader Harry Reid (D-NV) has tried to push forward online gambling legislation, only to see it fail. Zynga may be poised to capitalize on any such legislation, should it eventually pass, Gupta said.

Zynga is heavily reliant on Facebook (FB), both in terms of revenue, and traffic, with the likes of Farmville, Mafia Wars and CityVille seeing explosive growth based mostly from the relationship. Online gambling could lessen this reliance, and Zynga may partner with other companies to help build the experience.

Potential partners include casino operators such as Wynn Casinos (WYNN), Caesar's Entertainment (CZR) and others, though Gupta added Zynga has nothing to announce at this time. Zynga recently launched its own Zynga.com platform, and has partnerships with Google (GOOG) Plus, Tencent and a recent announcement with Sina (SINA) Weibo to bring Draw Something to the Chinese social network.

The continued expansion of gambling in the United States will most certainly happen, as the federal government seeks to generate additional revenue to help pay down the federal deficit. New Jersey Governor Chris Christie has already said that he will push forward with his state's decision to allow sports gambling. The federal government, however, still has not approved sports gambling outside of Nevada, Oregon, Montana and Delaware.

See how the TheStreet Ratings ranks Zynga.

1 of 2

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,293.87 +27.88 0.16%
S&P 500 2,010.11 -1.25 -0.06%
NASDAQ 4,575.0790 -18.3460 -0.40%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs