Zynga, which became a mobile and social gaming behemoth a decade ago on the strength of its hit game Farmville, is becoming a part of Take-Two Interactive. Take-Two announced today that it has made a deal to acquire the company for $12.7 billion, a takeover that will turn the Grand Theft Auto publisher into one of the biggest mobile game companies in the industry.
"We are thrilled to announce our transformative transaction with Zynga, which significantly diversifies our business and establishes our leadership position in mobile, the fastest growing segment of the interactive entertainment industry," Take-Two chairman and CEO Strauss Zelnick said. "This strategic combination brings together our best-in-class console and PC franchises, with a market-leading, diversified mobile publishing platform that has a rich history of innovation and creativity. Zynga also has a highly talented and deeply experienced team, and we look forward to welcoming them into the Take-Two family in the coming months."
Industry hype aside, this is a big deal all around. Take-Two has previously said that mobile gaming "remains a key growth opportunity" for the company and, in its first quarter financial results for 2022, Zelnick said the company's investments in the future would include "growing our creative teams and expanding our mobile business and expertise further." Zynga's fortunes have waxed and waned since the glory days of Farmville but it remains a major player in mobile, with games including Words With Friends, Harry Potter: Puzzles and Spells, and—still—the Farmville series driving revenues of nearly $2 billion in its 2020 fiscal year.
The addition of Zynga's mobile library will enable Take-Two to expand its sources of recurrent consumer spending, a lucrative source of revenue the company said will "help reduce volatility" in its financial results in the years between releases in its major franchises, something the company has previously been criticized for.
We're also going to see the development of more mobile games based on "many of the iconic franchises within Take-Two’s portfolio of intellectual property," the company said.
"Take-Two has an extensive catalog of commercially and critically successful console and PC titles with engaged and loyal communities of players, and there is a meaningful opportunity to create mobile games and new cross-platform experiences for many of these properties."