Zynga IPO delayed: reports

Mon Aug 29, 2011 5:50pm EDT
 

By Liana B. Baker

NEW YORK (Reuters) - Zynga, the social games maker may delay its plans for an initial public offering because of poor market conditions and to answer questions from the U.S. Securities and Exchange Commission, according to media reports on Monday.

The delay is partly related to questions the SEC has about how Zynga measures its daily and monthly users, as well its bookings, CNBC reported. Zynga has had "extensive talks" with SEC about these matters, according to the report.

Zynga in its S-1 filing said that it uses a financial measure called bookings, which is revenue from the sale of virtual goods that are used in games -- such as weapons or crops -- and from advertising over a certain period of time.

The company uses the bookings figure internally. It is not meant to "substitute for revenue recognized in accordance with generally accepted accounting principles," Zynga said in its filing.

Zynga's IPO was expected in early September and now may not come until November, the New York Post reported earlier on Monday.

The company is still moving ahead with its IPO plans but is "no longer in a rush because of the rocky stock markets," according to the Post, which cited two sources with knowledge of Zynga's plans.

Another source close to the company said Zynga's public debut could be delayed until November, the Post reported. The company will have a clearer sense of its plans post-Labor Day, according to the report.

Zynga, which is the leading publisher of games on Facebook such as FarmVille, declined to comment. The company filed with U.S. regulators on July 1 for an IPO worth up to $1 billion.

(Reporting by Liana B. Baker and Clare Baldwin; Editing by Derek Caney and Tim Dobbyn)