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Shares in ailing "social gaming" firm Zynga tumbled 12 per cent on Monday to $2.99, after chief Mark Pincus announced that the company would be laying off more than 500 employees.

Zynga now expects to lose as much as $39m in the second quarter, since its games (other than the popular Farmville) have once more underperformed. Hence the firm is planning to axe 18 per cent of its workers to try to cut costs.

Although Pincus made the announcement on the company blog, it seems some staff members were surprised to find out they'd lost their jobs through social media. Workers from OMGPOP, the Draw Something game-maker that Zynga slurped for a reported $200m just 16 months ago, were part of the company-wide layoffs, but don’t appear to have been properly informed.

The former veep of people at OMGPOP Ali Nicolas tweeted that she learned about her employment status on Facebook:

She later said:

Pincus said in his blog post that the firm was letting staff go “proactively and from a position of financial strength”, so workers would get “generous severance packages”.

“These moves, while hard to face today, represent a proactive commitment to our mission of connecting the world through games,” he said.

“Our opportunity is to make mobile gaming truly social by offering people new, fun ways to meet, play and connect. By reducing our cost structure today we will offer our teams the runway they need to take risks and develop these breakthrough new social experiences.”

Zynga is one of the many new internet-related firms to sell itself for $1bn, having gone public in 2011 with stocks priced at $10 each. As with a number of its counterparts, the firm has since failed to live up to its price tag.

The company’s reliance on Facebook for revenue and its failure to catch on swiftly enough to the move to mobile have consistently concerned investors and it is now trying to revive its fortunes by moving into online gambling. ®

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