Here's Why We Think Zynga's Gross Margin Could Decline In The Future

We believe the key contributing factor to Zynga?s gross margin decrease in the future will be its ongoing shift towards the mobile platform, as mobile revenue is recognized on gross basis, as compared to Facebook-related revenues, where the revenue is recognized on net basis. Moreover, the continued decline in its Facebook business will further put pressure on margins. We think it is unlikely that Zynga?s business will re-accelerate in the short-term, and this could cause some operating de-lever...