Zynga Becomes Second Most Valuable Game Company

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It’s hard to believe that a company that did not even exist five years ago has emerged as the second most valuable third party game company by market capitalization (that is, the value of all of the company’s out standing stock). Even more amazing is that they made their name by making games for Facebook.

That company’s name is Zynga. They’re currently valued higher than Electronic Arts, Take-Two, Ubisoft, and other video game stalwarts. Only Activision Blizzard, valued at $13.3 billion, is currently more valuable. Venture Beat did a profile on the company’s remarkable rise with an nontraditional business model.

Market value does not necessarily reflect true position in a market. As Dean Takahashi notes, the company posted a profit of $400 million last year on $850 million worth of revenue. Not bad, particularly for an industry that has seen its share of losses recently. However, EA had revenue of $3.7 billion last year and Activision Blizzard $4.8 billion. In terms of actual cash coming in, Zynga has a long way to go to catch the big boys.