Facebook share drop disappoints investors

Published:  30 Jul at 9 AM

Facebook shares dropped to an all time low last week after the social networking site published its first ever quarterly results since becoming a public company. The company said that for the quarter ending in June it had lost $157 million.

When it first listed on the Nasdaq back in May the price per share was $38. Last week saw that price settle at $23.71, a loss of 12 per cent.

Revenue for the second quarter was slightly better than analysts had been expecting at $1.18 billion, a growth of 32 per cent on the same period a year earlier. However, Piper Jaffray analysts said that investors were looking for more.

Facebook said it has 955 million monthly active users which is a growth 29 per cent compared to last year. Some experts have been questioning the accuracy of this figure because of the number of fake profiles which have gone up on the site.

The year-on-year increase in the number of people using mobile devices has shot up by 67 per cent to 543 million. This represents a move away from the computer screen and the challenge for Facebook is to work out how it will generate money from those who now use their phones to log onto their profiles.