Zynga Inc.

Thank you for standing by and welcome to Zynga's second quarter 2021 results conference call. At this time, all participants are in a listen-only mode. After the speaker presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1 on your touchtone telephone. Please be advised that today's conference may be recorded. Should you require any further assistance, please press star 0. I would now like to hand the conference over to your host, Rebecca Lau. Please go ahead.

Thank you, Lateef, and welcome to Zynga's second quarter 2021 earnings call. On the call with me today are Frank Jabot, our Chief Executive Officer, and Jer Griffin, our Chief Financial Officer. Shortly, we will open up the call for live questions. During the course of today's call, we will make forward-looking statements related to our business plan and strategy, as well as expectations for our future performance. Actual results may differ materially from the results predicted. Please review the risk factors in our most recently filed Form 10-Q as well as elsewhere in our SEC filings for further clarification. In addition, we will also discuss non-GAAP financial measures. Our earnings letter, earnings slides, and when filed, our 10-Q will include reconciliations of our GAAP and non-GAAP financial measures. Please be sure to look at these reconciliations as the non-GAAP measures are not intended to be a substitute for or superior to our GAAP results. This conference call is being webcasted and will be available for audio replay on our investor relations website in a few hours. Now, I'll turn the call over to Frank for his opening remarks.

Thank you, Rebecca. Good afternoon, everyone, and thank you for joining our Q2 earnings call. We delivered strong results this quarter ahead of guidance, including our best-ever Q2 revenue bookings and operating cash flow. This Q2 performance capped off a dynamic first half of the year for Zynga, and reflects our team's continued commitment to connect the world through games during these unprecedented times. Today, we are making several exciting announcements that demonstrate significant progress on our long-term growth strategy. While we will discuss each of these in more detail later on the call, I would like to start by officially welcoming the ChartBoost team to Zynga following the close of our acquisition just a day ago. In addition, we are also excited to announce our agreement to acquire Starlark, the makers of the hit franchise golf rival. We look forward to welcoming this talented team to Zynga later in Q4. Starting with our Q2 performance. In the quarter, we delivered our highest ever Q2 revenue of $720 million, up 59% year-over-year, and record Q2 bookings of $712 million, an increase of 37% year-over-year. Our top line performance combined with positive operating leverage generated our highest ever Q2 operating cash flow of $161 million. Our strong Q2 results were driven by our diverse portfolio of leading mobile franchises and our live services platform. By leveraging our best in class data science, product management, user acquisition, and advertising capabilities, our teams are able to release innovative bold beats to engage and attract players. For example, in Q2, the release of a new Disco Fever bold beat in Toon Blast and the introduction of a Teams feature in Toy Blast drove strong performances in both of these franchises as we approached Peak's first anniversary at Zynga. In Harry Potter's Puzzles and Spells, our release of a club-based magical mischief event also provided a new way for players to engage and compete between teams. Within our portfolio, Social Casino also continues to deliver incredible results. Social Slots achieved yet another all-time best revenue and bookings quarter, while Zynga Poker also delivered its best Q2 revenue and bookings performance in nine years. During the quarter, we also generated our all-time best advertising revenue and bookings performance. Words with Friends delivered its best Q2 revenue and bookings in the franchise's 12-year history, driven by its recent introductions of Rewards Pass and new solo challenge content. Rollick also delivered a record top-line quarter and was the fastest-growing hyper-casual game company in the world, measured by sequential growth in downloads. By leveraging its unique development process that incorporates key data insights and rigorous testing, Rollick is demonstrating its unique ability to repeatedly design and publish hit titles in this competitive category. For example, in April and May, Hair Challenge reached the number one top free downloaded game position in the US App Store and Google Play, while Queen Bee reached number one on top free downloaded game position in the US App Store and Google Play in June. Overall, we are pleased with our performance in the first half of 2021, and are especially excited about the growth potential that lies ahead of us. In the short term, however, we are navigating market dynamics related to the great reopening and Apple's privacy changes that have created choppiness in our business. Toward the end of Q2, as communities began to reopen and reduce their COVID-19 restrictions, we saw softness in our bookings primarily driven by declines in player cohorts who installed our games in the early part of 2021. At the same time, the adoption of Apple's privacy changes resulted in a higher cost to acquire new players. In response, we scaled back our UA spend to maintain targeted returns, resulting in fewer players installing our games during this period. We believe these trends are short-term in nature. We are already seeing improvements in user acquisition yields, and within our core audience that accounts for the vast majority of our bookings, we continue to see strong engagement and monetization. As we progress through the second half of the year, we are also increasing the number of bold beats across our live services to further engage and monetize our player base. Given these short-term market dynamics, we are adjusting our live services outlook for the remainder of 2021, as well as moving the launch of FarmVille 3 from Q3 to Q4. While we are revising our top line expectations for the full year, we are maintaining our profitability guidance for 2021, which Jer will tell you more about shortly on this call. As we look ahead, we are incredibly excited by our positioning within the dynamic and fast-growing interactive entertainment sector and the multiple catalysts that we have in place to deliver strong top line growth and margin expansion in the years ahead. Execution of our multi-year growth strategy enables Zynga to drive recurring organic growth from our expanding live services portfolio and new game pipeline. In addition, we are investing in hyper-casual games, cross-platform play, international expansion, and advertising technologies, all of which have the ability to meaningfully increase Zynga's total addressable market and further enhance our competitive advantage and growth potential within the interactive entertainment industry. Since our last update, we have made notable progress across the following key aspects of our growth strategy. First, our upcoming new game launches will be meaningful organic drivers for Zynga in 2022. We are in the final stages of soft launch for Farmville 3, a brand new mobile experience designed to captivate the imagination of players who have enjoyed Farmville over the past decade, as well as the enthusiasms for a new generation of gamers. We now expect to launch Farmville 3 to players worldwide in Q4. In addition, Star Wars Hunters has been hitting key production milestones in development and will soon enter soft launch on mobile in select test markets in Q4. The title's multiplayer, action-oriented, cross-platform gameplay is generating exceptionally positive initial feedback, and we are building on this momentum by creating new features and modes within the game. Our global studios are also making strong progress on our exciting new game pipeline, and we expect to test market more new titles in 2022. Second, Rollick's hyper-casual games portfolio recently surpassed 1 billion total downloads worldwide. This tremendous milestone further establishes Rollick as one of the largest hyper-casual publishers in the world, with 15 games that have reached the number one or number two top free downloaded games position in the US App Store, as well as three titles, Hair Challenge, High Heels, and Tanglemaster 3D, which have each generated over 100 million downloads worldwide. As this style of gaming continues to evolve, we see the potential for some of Rolex's most popular games to scale into sustainable live service franchises and we are investing in features to further engage and entertain these audiences. For example, in June, High Heels featured a first-of-its-kind partnership with Kenneth Cole, debuting the iconic designer's Pride 2021 collection in-game to celebrate diversity and raise awareness for the Mental Health Coalition. In Hair Challenge, Rollick has also released its first major bold beat, Leaderboards, which drove an immediate lift in player engagement. Third, with the close of our acquisition of ChartBoost, we are meaningfully expanding our advertising and monetization platform. ChartBoost enables Zynga to reach a new level of audience scale and meaningfully enhances our competitive advantage in the mobile ecosystem. Together, Zynga and ChartBoost possess all the elements of a complete next-generation platform. High-quality content, direct player relationships, massive reach, and full-stack advertising technology that can be applied across Zynga's game portfolio and chart-boost advertising partners. Fourth, today we are announcing our agreement to acquire Starlark, the China-based development team of Golf Rival, the fast-growing and second-largest mobile golf game in the world. This acquisition brings to Zynga a talented team with proven ability to create a global casual hit with additional new products and early developments. Starlark also expands Zynga's international presence by establishing a China-based studio with access to the region's creative talent base. Together, Zynga and Starlark are well-positioned to grow golf rival faster together following the expected close of the acquisition in Q4. In summary, we remain incredibly excited by the ongoing growth trends within interactive entertainment, as well as Zynga's unique position as one of the leading mobile game developers and publishers in the world. Our investments to date have added meaningful scale to Zynga's portfolio, while also expanding our studios, enhancing our platform capabilities, and amplifying our collaborative culture. While we are navigating some short-term market dynamics, we remain confident that ongoing execution of our multi-year growth strategy will position us for continued top-line growth and improved operating leverage in the coming years. This, in turn, will generate more long-term value for our players, teams, and shareholders. With that, I would now like to turn the call over to Jer to discuss our Q2 results and forward outlook in more detail.