facebook logo Facebook loses $157 million in second quarter

Facebook has reported a loss of $157 million in the second quarter of the year, causing shares to plummet only two months after the company went public.

Facebook has reported a loss of $157 million in the second quarter of the year, causing shares to plummet only two months after the company went public.

 
Revenue was up 32 percent to $1.18 billion, but those profits were eaten up by payments to early investors, including founder and CEO Mark Zuckerberg. If it were not for this employee share deal, the company would have posted a profit of $295 million, more than the $240 million it made at the same time last year.
 
There was an 11 percent drop in share values in response to the news, down to just $23.94, substantially lower than the opening price of $38 in the company's IPO in May. Despite this, many shareholders are not overly concerned, given Facebook's potential and the likelihood that share prices will rally in the coming days, weeks and months.
 
facebook logo Facebook loses $157 million in second quarter
 
Monthly active users were up 29 percent to 955 million, while mobile daily active users were up a massive 67 percent to 543 million compared to the second quarter of 2011, showing that there is still growth occuring on the social network.
 
Some believe Facebook has been over-valued, however, which may ring true with the fact that the company failed to sell shares over its initial asking price, as was largely expected at the time. Others feel that the company lacks potential to make revenue, while some are still in it for the long haul, hoping to see another Google on their hands.
 
Source: BBC