When times are tough, companies have to take tough decisions and non-performers have to be weeded out.
On Tuesday Joel Ewanick, the global marketing head of General Motors Company(NYSE:GM) was given the marching orders for not performing up to expectations. Now game maker Zynga Inc’s (NASDAQ:ZNGA) Chief Operating Officer John Schappert, has been stripped of his role overseeing game development, Bloomberg reported on Wednesday, quoting people familiar with the matter.
Can ZNGA Rebound After Recent Slump? Get Free Trend Analysis
The report said that the decision was taken as part of a reorganisation strategy to revive growth and make more money from mobile services.
David Ko, who runs Zynga’s mobile operations, and Steve Chiang, executive vice president of games, both of whom reported to Schappert, now report directly to Chief Executive Officer Mark Pincus, Bloomberg said.
The report said that CEO Pincus had started on the organisation revamp in early July, at the close of a quarter marked by slowing sales growth and a drop in demand for virtual goods.
Last week Zynga reported a net loss of $22.8 million, or 3 cents a share, compared with a profit of $1.4 million a year ago, missing analyst forecasts. It also pegged its earnings in 2012 between 4 and 9 cents a share, down from the 23 to 29 cents previously forecast.
Schappert who was lured from rival Electronic Arts Inc. with a pay package worth $42.8 million, has lost support within the company and taken some of the blame for its underperformance, Bloomberg said.
Find Multiple Trading Strategies on ZNGA Here
“The place is in utter meltdown mode,” Bloomberg quoted Richard Greenfield, an analyst at BTIG LLC in New York, as saying in an interview.
Stephanie Hess, a spokeswoman for San Francisco-based Zynga, declined to comment, said the report.
Shares of Zynga were trading down 4.4 percent at $2.82 in morning trades and made another record low of $2.75.