Shares of Zynga plummeted 40 percent to $3.03 in after market trading after the social game developer reported a net loss for its second quarter ended June 30, 2012. Zynga tried to put a positive spin on the fact that its Q2 revenue of $332 million represents a 19 percent year-over-year increase and that its six months year-to-date revenue of $653 million is a 25 percent year-over-year increase, but the numbers still added up to a $22.8 million net loss for the quarter, and a $108.1 million net loss for the six month period.
In a conference call with analysts, John Schappert, chief operating officer for Zynga, was critical of changes Facebook made last quarter.
"Facebook made a number of changes in the quarter. These changes favored new games. Our users did not remain as engaged and did not come back as often," Shcappert explained, according to The New York Times .
That's concerning, but the biggest red flag for investors is the fact that Zynga sharply cut its forecast for its bookings (leftover revenue after paying Facebook) to as low as $1.15 billion, down from a previous projection of $1.47 billion.
More details are included in the full report (PDF) .