Shares of embattled social-gaming company, Zynga Inc. (NASDAQ: ZNGA) rallied on Monday after the Company announced that it will slash another 1% of its workforce, shutter more offices to drive up the profitability. Meanwhile, the recent enacting of a law in Nevada which makes online betting legal in the state also helped the company to regain investors’ trust.
The San Francisco-based Company, known for titles such as “FarmVille” and “Words with Friends,” has been hoping that more States would soon follow Nevada to make online gambling legal.
In 2012, the social gaming company entered a deal with a U.K. based online gaming operator, Bwin.Party to provide real money online poker, including some other games like blackjack. Later the Company took its first stride forward to make online gambling legal in the U.S. by applying for a license to Nevada Gaming Control Board in last December 2012.
Just last Thursday, Nevada Governor Brian Sandoval passed a new law that permits Nevada to enter into accord with other states that will let Nevada-based companies to host interactive gambling for residents of other states. The Company is betting that soon many states will follow Nevada by making online gambling legal.
While the Company turns its attention towards other avenues for future growth, it has also been aggressively involved in cost cutting measures. After removing more than dozen non-performing titles and closing down offices to cut costs in the recent past, Zynga announced some new cost cutting measures on Monday.
The Company said that it will streamline its real assets, and close down its Baltimore studio a move which would allow cut the workforce by another 1%, including certain fixed costs.
“In an effort to leverage resources as we focus on creating franchises and driving profitability, Zynga has made changes to four of our U.S. offices,” said David Ko, Zynga’s Chief Operating Officer in a statement.
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