4 ms·

Income at an all-time high, revenue doubled in the last two years, but shareholders are unhappy? Could somebody please explain this to me?

huac 8y ago
they expected more growth, and FB projected more costs.
jedberg 8y ago
A lot of the stock price was based on expected extreme continued growth. They just explicitly said that the growth is slowing and will slow down more, so they're basically losing all of the priced in growth.
sago 8y ago
The value perceived by shareholders is only partially related to the current revenues. It is about perceived future value. And shareholders are right to be spooked I think. Revenues have grown 47% for only 11% in MAU. I don't hold shares in Facebook, but combined with the feedback I hear from friends and family about Facebook becoming increasingly ad-obsessed and devoid of valuable content, that would make me very nervous too.
- cgb223 8y ago
  Lets not forget that Facebook the company is not just Facebook the Website They also own Instagram, Whatsapp, and a host of other massive online properties While Facebook dies, Instagram (seems anyway) to be thriving
  - lainga 8y ago
    Now, a bad idea for Instagram would be to couple it tightly to Facebook, so that the demise of one drags down the other. Oh, wait...
    - sushid 8y ago
      It's NOT coupled tightly at all. You don't need an FB account.
- tehlike 8y ago
  Facebook is diversifying into non owned operated 3p apps through audience network.
- cporios 8y ago
  11% may be the YoY growth in world-wide MAU, but MAU has actually dropped in Europe and remained constant in the US compared to last quarter.
oh-kumudo 8y ago
Priced for growth, growth slowed.
samspenc 8y ago
Revenue missed expectations (even though it grew in absolute terms), and user growth has slowed down again, and that is making investors nervous.
- tmalsburg2 8y ago
  When almost everyone is on Facebook, user growth just has to slow down -- basic math. User growth becomes meaningless as a metric and revenue per user is what matters then. What did investors expect? Indefinite linear or even exponential user growth?
  - rainbowmverse 8y ago
    It's obvious to anyone without a vested interest in Facebook growing forever. However, much of capitalist society is built on the assumption that growth will never end. Things start falling apart when that assumption inevitably proves wrong.
  - cporios 8y ago
    It hasn't just slowed down. MAU/DAUs in Europe have dropped compared to last quarter, and stayed flat in the US.

huac 8y ago

they expected more growth, and FB projected more costs.

jedberg 8y ago

A lot of the stock price was based on expected extreme continued growth. They just explicitly said that the growth is slowing and will slow down more, so they're basically losing all of the priced in growth.

sago 8y ago

The value perceived by shareholders is only partially related to the current revenues. It is about perceived future value. And shareholders are right to be spooked I think. Revenues have grown 47% for only 11% in MAU. I don't hold shares in Facebook, but combined with the feedback I hear from friends and family about Facebook becoming increasingly ad-obsessed and devoid of valuable content, that would make me very nervous too.

cgb223 8y ago
Lets not forget that Facebook the company is not just Facebook the Website They also own Instagram, Whatsapp, and a host of other massive online properties While Facebook dies, Instagram (seems anyway) to be thriving
- lainga 8y ago
  Now, a bad idea for Instagram would be to couple it tightly to Facebook, so that the demise of one drags down the other. Oh, wait...
  - sushid 8y ago
    It's NOT coupled tightly at all. You don't need an FB account.
tehlike 8y ago
Facebook is diversifying into non owned operated 3p apps through audience network.
cporios 8y ago
11% may be the YoY growth in world-wide MAU, but MAU has actually dropped in Europe and remained constant in the US compared to last quarter.

oh-kumudo 8y ago

Priced for growth, growth slowed.

samspenc 8y ago

Revenue missed expectations (even though it grew in absolute terms), and user growth has slowed down again, and that is making investors nervous.

tmalsburg2 8y ago
When almost everyone is on Facebook, user growth just has to slow down -- basic math. User growth becomes meaningless as a metric and revenue per user is what matters then. What did investors expect? Indefinite linear or even exponential user growth?
- rainbowmverse 8y ago
  It's obvious to anyone without a vested interest in Facebook growing forever. However, much of capitalist society is built on the assumption that growth will never end. Things start falling apart when that assumption inevitably proves wrong.
- cporios 8y ago
  It hasn't just slowed down. MAU/DAUs in Europe have dropped compared to last quarter, and stayed flat in the US.