Breaking News Bar
posted: 6/15/2013 7:22 AM

Zuckerberg defends Facebook IPO by touting mobile push

hello
Success - Article sent! close
  • Facebook Chief Executive Officer Mark Zuckerberg says, of the IPO: "I think it's been a disaster."

      Facebook Chief Executive Officer Mark Zuckerberg says, of the IPO: "I think it's been a disaster."

 
By Bloomberg News

SAN FRANCISCO -- A year after Facebook's bungled public market debut, Chief Executive Officer Mark Zuckerberg is still facing the wrath of ordinary investors holding stakes now worth a fraction of what they paid.

At the company's first shareholder meeting since an initial public offering in May 2012, one man who identified himself as Daniel summed up the frustration of many, saying of the IPO: "I think it's been a disaster."

Order Reprint Print Article
 
Interested in reusing this article?
Custom reprints are a powerful and strategic way to share your article with customers, employees and prospects.
The YGS Group provides digital and printed reprint services for Daily Herald. Complete the form to the right and a reprint consultant will contact you to discuss how you can reuse this article.
Need more information about reprints? Visit our Reprints Section for more details.

Contact information ( * required )

Success - request sent close

Facebook, operator of the world's most popular social network, has lost more than 35 percent since the IPO as investors questioned the company's ability to boost mobile- advertising revenue. While Zuckerberg's focus on software and ads for smartphones and tablets has helped the shares rebound 36 percent from a low in September, he said the company is investing in products and services that will reward investors over the long term.

"We understand that a lot of people are disappointed in the performance of the stock and we really are too," Zuckerberg said in his opening remarks at the meeting.

Facebook hasn't closed above the $38 IPO price since its first trading day.

At the time of its IPO, underwriters led by Morgan Stanley set a price that valued Facebook at 107 times reported earnings in the past 12 months, more than every Standard & Poor's 500 stock except two. Facebook and Morgan Stanley have faced criticism for increasing the number of shares to be sold in the IPO by 25 percent to 421.2 million days before the offering and pushing up the asking price.

The post-IPO performance "has harmed a lot of people -- not just in Facebook stock -- but for the average person to trust and invest in the stock market in general," the man who called himself Daniel said.

One woman's question laid bare the losses some retail investors now face.

"Is it worth it for me to keep my shares I bought from the day of the IPO at $42 and $43?" she asked via telephone. "At this point I'm still hanging on. I want to know if the company has any strategy to create a new product to boost up the price per share in the near future."

Zuckerberg, in remarks aimed at the many similar queries received in advance of the Menlo Park, Calif.-based company's annual meeting Tuesday, said he's always "taken a pretty long-term view" of Facebook's market performance.

"Over time we're building an asset and a network that's increasingly valuable in the world, and we believe that over the long term we will generate the most value for shareholders by doing that," Zuckerberg said.

Share this page
Comments ()
Guidelines: Keep it civil and on topic; no profanity, vulgarity, slurs or personal attacks. People who harass others or joke about tragedies will be blocked. If a comment violates these standards or our terms of service, click the X in the upper right corner of the comment box. To find our more, read our FAQ.
    help here