Analyst: Mattrick's Zynga move little reason for optimism

Responding to yesterday's news of Don Mattrick's departure as Microsoft entertainment head to become CEO of Zynga, equity research firm Cowen remains cautious about Zynga (ZNGA)'s outlook. "As [Mattrick] is a console veteran, we are not sure how much Mattrick's experience will benefit Zynga," says Cowen analyst Doug Creutz in a company update. "Zynga [is] a business in desperate need of a radical turnaround, while competitors such as King, Kabam, Supercell, and even EA (where we would have been much less surprised to see Mattrick land) are busy pushing ahead rapidly on mobile platforms." Cowen noted that other console executives have struggled to make the transition to free-to-play, including John Schappert, who departed Zynga after a tenure at EA. The equity research firm also noted that Mattrick's position at Zynga is potentially tricky, with outgoing CEO Mark Pincus staying on as Chairman and CPO. Pincus will also retain a controlling voting stake in the company. "As a result, it is not clear how much operating room Mattrick will really have," Cowen concluded. In response to the news, Cowen has reduced its non-GAAP revenue estimate for Zynga for the 2013 fiscal year from $809 million to $782 million. Its EPS estimate shifted from $0.07 to $0.08, "reflecting our view of current business trends as well as the company's guidance update on June 3."