NEW YORK ( TheStreet) -- Less than a month after he returned as Chief Executive of Zynga (ZNGA), Mark Pincus is taking the axe to the social gaming company he co-founded. This might be the last chance to get the one-time high flier on track after several years of missteps.
Pincus and the gaming company though, have a lot to prove.
"Pincus certainly has his work cut out for him," said Arvind Bhatia, of Sterne Agee. "He is combating continued declines in Zynga's legacy web business while simultaneously restructuring the company's workforce."
Zynga, which once derived nearly all its revenue and traffic from games played via Facebook (FB), has been trying to shift to more mobile gaming. The efforts have shown some success. During the first quarter of the year, Zynga reported bookings of $167.4 million, with mobile bookings making up 63% of that amount. Mobile bookings also rose 84% from a year ago.
The job cuts were announced late Wednesday along with Zynga's first-quarter results. Zynga reported a loss of a penny a share, excluding one-time items, on $183.3 million in revenue. During the year-ago period, Zynga also lost a penny a share on $168 million in sales.
Initial investor reaction to Pincus' plan to slash Zynga's workforce by 364 jobs, or about 18%, and trim costs by $100 million annually, was upbeat, as shares rose Thursday. But the company's future remains unclear.