![]() ![]() ![]() Facebook Credits were implemented in their games, starting in July 2010 and completed for all games as the sole purchase currency in April of 2011.It also provides an incentive to focus games more on consumables than durables moving forward. Thus it is likely that this new ability helped improve the revenue in Q4 of 2009 and Q1 of 2010. By January 2010, they were able to reflect this split in all games, meaning they could escalate revenue recognition. Zynga was only able to discern consumables versus durables starting in October of 2009, and only in one game. Items that are consumables (like fuel or energy or components that are purchased and used) can be recognized within a month, while durable items (like tractors or décor that are used over time) take a longer time to be recognized (it isn’t specified in the S1, but it typically is amortized over the life of a user – for more discussion to revenue recognition, see this blog post from Bill Gurley). The revenue figures are impacted by some accounting rules as to when the revenues can be recognized.This revenue includes everything, including advertising and virtual goods, but advertising has never made more than 5% of total revenues.Some interesting notes on this revenue figure: The S1 shows gross revenue by quarter as follows: ![]() ![]() Zynga filed their S1 last Friday, and while some have focused on how rich CEO Mark Pincus and his officers could become, I’ve been looking at the financials and trying to tie it back to their daily active users (DAU) to look at revenue per DAU or ARPU (Average Revenue per User) so we could have some industry benchmarks. ![]()
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