Sales at the social-gaming company continued their slide under former Microsoft executive.
Zynga, the struggling maker of video games for mobile phones and tablets, said CEO Don Mattrick will leave the company and that founder and chairman Mark Pincus will return to the role of CEO.
The changes are effective April 8, the San Francisco-based company said Wednesday in a statement.
Mattrick was former head of Microsoft’s interactive-entertainment division and left to lead Zynga in July 2013. He will also give up his seat on Zynga’s board.
Zynga faltered to revive revenue after once leading the market for games played on social media, such as Farmville. Sales last year declined 21 percent from 2013, and the company reported a loss of $226 million.
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Pincus controls a majority of the stock in the company, which he founded in 2007.
“He moved too deliberately and Pincus was too impatient,” said Michael Pachter, an analyst at Wedbush Securities in Los Angeles. It’s a “bad combination for career stability if the controlling shareholder thinks the CEO is taking too long to turn the ship around.”
Shares of Zynga plunged as much as 13 percent to $2.52 in extended trading. The stock rose 3.6 percent to $2.90 at the close in New York. It traded at a high of $15.91 in March 2012, about three months after it first sold stock to the public.
“Don joined us in a very important time in our evolution,” Pincus said in the statement.
“The team’s hard work for our mobile players has resulted in bookings growing from 27 percent mobile bookings when Don joined to 60 percent by the end of last year.”
Mattrick, 51, joined Zynga as game play was transitioning to mobile products such as smartphones and tablets, and failed to produce new titles to replace its aging hits. Sales shrank to $690 million last year from a peak of $1.28 billion in 2012.
King Digital Entertainment, maker of the popular Candy Crush games, has emerged as the leader in mobile games, with revenue of $2.26 billion last year.
Mattrick will receive a $4 million severance payment, according to the company, and may get up to $1 million for a 2015 bonus.
The company will also accelerate the vesting of 5.11 million shares granted to its former chief.
“I believe the timing is now right for me to leave as CEO and let Mark lead the company into its next chapter given his passion for the founding vision and his ability to couple our mobile progress with Zynga’s unique strengths,” Mattrick said in the statement.