Zynga puts kibosh on real-money gambling plans in U.S.

There has been much talk about Zynga making a company-wide strategic shift to focus on real-money online gambling. But as former Xbox boss Don Mattrick takes the reins as CEO, the company said it's putting the kibosh on company-wide gambling initiatives. The company said in its quarterly earnings report today that it will focus on the free-to-play games that it has become known for, instead of gambling, at least in the U.S. Zynga stated:

Zynga had appeared to be repositioning its efforts to focus on gambling. The company has launched Facebook gambling games in the UK, and owns popular properties like Zynga Poker and casino titles that could transition smoothly to real-money gaming. It seemed like a lucrative option for the company as it continued to falter in its shift to mobile. Zynga also had acquired Spooky Cool Labs, a social developer with extensive casino experience. But COO David Ko said the studio would create casual, non-real-money casino games, not real-money gambling games. Zynga investors had apparently expected Zynga to make the gambling shift: In February, when Nevada said it would legalize casino games online, shares got a notable boost. The changes in leadership and in gambling strategy come as Zynga continues to struggle as the market shifts from web to mobile. Zynga's revenues were down 31 percent for the quarter ended in June to $231 million. Zynga posted a net loss of $16 million for the quarter, smaller than the $23 million loss a year ago. Ko said on an earnings call, "These results are unacceptable. As Don [Mattrick] stated, we can do better."