Facebook Q2 2012 Earnings Meet Analyst Predictions, But Shares Plummet
July 27, 2012 11:29 AM
comment(s) - last by
Facebook posted $1.18 billion in Q2 2012 revenues and a net loss of $157 million (8 cents per share)
Facebook's first financial earnings report since going public in May was pretty good, but failed to impress investors. The social networking giant posted $1.18 billion in Q2 2012 revenues, which was a 32 percent jump from Q2 2011. This figure modestly passed analyst expectations of $1.15 billion in revenues.
However, Facebook did report a net loss of $157 million (8 cents per share), which fell from $240 million (11 cents per share) in Q2 2011. This was likely due to the $1.3 billion the company paid in compensation regarding stock-based pay after the initial public offering (IPO) in May.
After adjusting to figures to exclude those costs, Facebook earned a profit of 12 cents per share, which was right in line with analyst expectations.
Facebook shares are currently
down over 12% to $23.45
, which is roughly 40 percent below the initial
IPO price of $38 per share
"Our goal is to help every person stay connected and every product they use be a great social experience," said Mark Zuckerberg, Facebook CEO. "That's why we're so focused on investing in our priorities of mobile, platform and social ads to help people have these experiences with their friends."
Facebook CEO Mark Zuckerberg [Image Source: Associated Press]
Facebook's IPO in May was the largest,
valuing the social giant at over $100 billion
. However, the situation took a dive when shares were trading way below their initial price. In just a two-day span after the company went public, its shares plunged a total of 19 percent.
Morgan Stanley, Goldman Sachs Group Inc. and JPMorgan Chase & Co. are being sued in a Manhattan federal court by investors who claim that they were lied to about Facebook revenue forecasts before purchasing stock. Other underwriters, like Bank of America Corp. and Barclays PLC, as well as Facebook executives, are being sued as well.
According to reports, underwriters had like Morgan Stanley had selectively shared Facebook estimates, leaving out certain details that would have possibly changed investors' minds. Morgan Stanley reportedly cut its revenue forecasts for Facebook only days before the IPO launched, yet failed to let investors in on the changes. This
from the U.S. Securities and Exchange Commission (SEC) as well as the Financial Industry Regulatory Authority (FINRA).
While Facebook may be having some financial issues right now, it's looking ahead to new ventures that could potentially help the company. For instance, it was reported yesterday that
a new Facebook phone is expected to launch in mid 2013
. However, Facebook CEO Mark Zuckerberg
shot down those reports in an
The goal is to make money on mobile phone advertisements since Facebook had $3.15 billion in total advertising sales last year, but none of this came from ads on mobile devices.
This article is over a month old, voting and posting comments is disabled
The real money!!!
7/29/2012 2:21:40 PM
Facebook has potential to make money. But the real money is in the hands of the third-party app developers. For some absurd reason users continue to give them permission to do whatever they want with their data. Just wait until we start hearing more and more about how these developers are data mining publicly available databases for ways to extort you for money. All of those posts you make at three o'clock in the morning could come back to bite you in the face of a legal proceeding, insurance settlement or job promotion etc. But who can blame them. Why sell an app for $.99 when you can extort $3000 for not selling the information to the prosecuting attorneys.
“And I don't know why [Apple is] acting like it’s superior. I don't even get it. What are they trying to say?” -- Bill Gates on the Mac ads
Facebook Smartphone to be Released in Mid 2013
July 26, 2012, 5:40 PM
FINRA, SEC to Investigate First-Day Facebook Stock Problems
May 23, 2012, 3:46 PM
Facebook Shares Will Open at $38 USD
May 17, 2012, 6:20 PM
Facebook IPO Exceeds $100 Billion Mark
May 15, 2012, 10:37 AM
Facebook Will Force Android, iOS Users to Use Messenger App This Week
July 29, 2014, 11:26 AM
Amazon Launches 3D Printing Store
July 28, 2014, 1:00 PM
Google to Announce $1 Billion Twitch Purchase
July 25, 2014, 12:33 PM
Quick Note: European Central Bank Hacked, Personal Information Stolen
July 24, 2014, 5:20 PM
EU Privacy Watchdogs Meet with Google Over "Right to be Forgotten" Requests
July 24, 2014, 12:29 PM
Report: New UK Broadband Users Give Porn Filters the Shaft
July 23, 2014, 11:49 AM
Most Popular Articles
Kindle Fire Phone Review Roundup -- A Solid "Meh"
July 23, 2014, 2:09 PM
Ford Details ’15 F-150’s 325hp, 2.7L EcoBoost V6; Demonstrates 732-lb Weight Loss
July 22, 2014, 6:55 PM
Windows 9 Will Merge Windows, Windows Phone, Windows RT in 2015
July 23, 2014, 3:33 PM
Comcast Memo: Harassing Customers During Retention Calls Actually IS Our Policy
July 22, 2014, 5:19 PM
Sony's Xperia Z3 Gets Detailed in Leaked Photos
July 25, 2014, 2:30 PM
Latest Blog Posts
Space Terrorism is a Looming Threat For the United States
Apr 23, 2014, 7:47 PM
Facebook Aims to Provide Internet to "Every Person in the World" with Drones, Satellites
Apr 1, 2014, 10:20 AM
Retail Mobile Sites Experience Outages in Light of Simplexity's Bankruptcy
Mar 14, 2014, 8:48 AM
Tesla vs. BMW: Who Has the Safer EV?
Feb 1, 2014, 2:56 PM
Justice Leaks Details of Next HTC One Two Flagship Phone
Dec 5, 2013, 4:04 PM
More Blog Posts
Copyright 2014 DailyTech LLC. -
Terms, Conditions & Privacy Information