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Facebook’s Share Price Falls To New Low: Time To Logout?

Facebook’s Share Price Falls To New Low: Time To Logout?

 

Perhaps the start of the London Olympics was timed as a distraction for this week’s less than upbeat economic news, some of it from the tech sector. Facebook seems to be continuing on its course to undo any high expectations, and hype, that it acquired from its May 18th IPO when its shares were priced at $38. On Friday, Facebook shares fell to a new low of $22.37 when trading began in New York on Friday. Shares closed down 11.7% at $23.71 on Friday afternoon.

The decline followed Thursday’s announcement that the company had lost $157 million from April to June.

In the second quarter, Facebook’s revenue rose to $1.18 billion, a growth of 32%. But this just barely beat forecasts and, apparently (based on the free-falling stock price), fell short of investors’ expectations.

As a result, Facebook CEO Mark Zuckerberg fell further “down the ranks of the world’s billionaires,” losing $1.6 billion of his $13.7 billion net worth. As ever, don’t cry for him: he has sold some of his stock and, as this was done just after the IPO, he let go of 30.2 million shares at $37.58 a share, enabling him to make $1.1 billion.

Analysts cited two reasons for Facebook’s disappointing report:

  • While Facebook’s monthly active users (MAU) now exceed 95 million, the reliability of such figures has been questioned due to the number of fake profiles.
  • The number of people who log into Facebook’s site daily via a mobile device now has increased by 67% year-on-year to 543 million. But Facebook remains haunted by the issue of making mobile profitable.

It also didn’t help that online video game company Zynga whom CNET describes as “tied at the virtual hip to Facebook” reported poor earnings on Tuesday.

How much all of this means to Zuckerberg is debatable. According to CNET, it is “well understood — and Zuck and his team said as much on yesterday’s conference call — that Zuckerberg isn’t going to cater to the short-term interests of Wall Street.”

Overall, this was a week of disappointing earnings for even (seemingly) charmed tech companies such as Apple, who reported lower profits than expected. Even Starbucks’ earnings are down and there was that massive Twitter outage on Thursday.

It’s enough to make you want to shut down your machine and go for a hike or hop on your bike, the better to access Facebook via your mobile.

Might it be possible that we’re all getting “social-media fatigue”?

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42 comments

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5:35PM PDT on Aug 1, 2012

I hate facebook!

11:24AM PDT on Aug 1, 2012

Facebook is the next ... the next myspace LOL.

12:27PM PDT on Jul 31, 2012

When I read "It’s enough to make you want to shut down your machine and go for a hike or hop on your bike, the better to access Facebook via your mobile.", I thought that everyone is behind. People should have realized this earlier.

3:46AM PDT on Jul 31, 2012

Hardly a good deal to buy stocks in FB.

9:20PM PDT on Jul 29, 2012

I told you I told you I told you. But greedy people never listen to reason. They only see the money. Get ready to lose a lot more

9:16PM PDT on Jul 29, 2012

Hahahahahahahah you fools. The Facebook IPO was the biggest scam in history and ANYONE with the least amount of intelligence DID NOT BUY . It was all a scam to part greedy morons from their money . And it's working perfectly as you fools fell for it . Lost over 30 % already ? Hahahah. I hope you lose every penny. I told I told I told you Facebook should have been valued , at best , at $10.00

8:28AM PDT on Jul 29, 2012

"to respect another persons RIGHTS makes for peace" I do not use Facebook and do not judge does who do. I just got very angry at zuckerberg's flim flam escape to NOT PAY TAXES! to those who bought stock and have lo$t money I am truly sorry for your lo$$e$. Zuckerberg is also not to be trusted, he is starting to show his colors and they are not pretty.

3:32AM PDT on Jul 29, 2012

Life is about choices, to each their own

FYI Sorry friends,my profile is down until I get help from care2 support

9:20PM PDT on Jul 28, 2012

WOW I didn't know there were so many Facebook haters out there until I read the comments. I use and really like Facebook. I have reconnected with many of the people from my high school. On one site which is for my hometown one guy started to bully others. We just told him we weren't in high school anymore and that it was a site to talk to each other but bullying was not acceptable. I enjoy being connected to my sisters, children, grandchildren, nieces and great-nieces and nephews. It gives me a venue for knowing what they are up to. I know a lot more about them than what they would tell their grandmother. I am careful with what I write on their walls.
But for the article, Mark Zuckerburg is an arrogant man. He seems always to have been an arrogant man. Now he is the type person that if he were from my past I wouldn't bother to friend. He seems always to have had a problem with ethics and that doesn't seem to have changed. Combined with the arrogance who knows why they set the price so high. It may have been simply so he could make another 1.1 Billion and he didn't care who he got it from or how. He may become known as a legal robber.
But one thing I have learned in life. This to shall pass. I do wonder what happens next. What will it be? I just am not into twitter. My friends and I have some real conversations about the environment, the elections and causes close to our hearts and I don't feel you can get the depth we get with tweeting. And I don't care

6:34PM PDT on Jul 28, 2012

The bad news for those who bought shares in the IPO it is expected to go alot lower.

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