Microsoft Corporation (MSFT) Loses One to Zynga Inc (ZNGA)

Microsoft Corporation (NASDAQ:MSFT) has received its fair share of negative publicity within the gaming industry recently, following its controversial plans for the Xbox One that it was forced to promptly backtrack on. Microsoft Corporation (NASDAQ:MSFT) entertainment and gaming chief Don Mattrick has been the public face of that backlash, defending the company’s stance while also announcing the quick about-face.

AllThingsD is now reporting that Mattrick is preparing to leave Microsoft Corporation (NASDAQ:MSFT), but it’s not clear if the Xbox controversy played a role in that decision. Today also happens to mark the day that Microsoft was expected to revamp its organizational structure, a separate storyline also initially covered by AllThingsD. However, Mattrick’s departure is supposedly unrelated to the restructuring.

Mark Pincus

Mattrick’s possible destination is none other than beleaguered social gamer Zynga Inc (NASDAQ:ZNGA). Mattrick and Zynga Inc (NASDAQ:ZNGA)have allegedly been in talks for quite a while, and Zynga Inc (NASDAQ:ZNGA) is in desperate need of someone to lead a turnaround. Mattrick could potentially be taking the CEO spot from Mark Pincus. Rival game maker Electronic Arts Inc. (NASDAQ:EA) has also been looking for a new CEO following John Riccitiello’s resignation in March, and Mattrick was also a top candidate for that C-suite spot.

Microsoft Corporation (NASDAQ:MSFT) doesn’t immediately have a replacement lined up, which may be disconcerting for investors, given that the Xbox One launches in just a matter of months. This holiday season will be crunch time for game console manufacturers, as new generations only come around every seven to 10 years, and Sony Corporation (ADR) (NYSE:SNE) emerged from E3 as a clear favorite before Microsoft Corporation (NASDAQ:MSFT)’s change of heart. Traditional gaming consoles are under pressure, too, as disruptive devices like the Ouya start to take off.

Zynga Inc (NASDAQ:ZNGA) investors are certainly excited about the prospect, as shares promptly soared by as much as 13% on the reports that Pincus’ reign may be at an end. Even if Mattrick does become Zynga’s new CEO, Pincus will still retain much of his power, though. Pincus would likely remain as chairman. He does happen to still control 61% of all voting power, thanks in large part to his supervoting Class C shares that get 70 votes per share and that only he holds.

Could Mattrick lead Zynga Inc (NASDAQ:ZNGA) back to glory?

The article Microsoft Loses One to Zynga originally appeared on Fool.com and is written by Evan Niu, CFA.

Fool contributor Evan Niu, CFA, has no position in any stocks mentioned. The Motley Fool owns shares of Microsoft.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

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