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Tag: Facebook IPO

  • Facebook Closes at $31.12; SEC Examines IPO Issues

    Today Facebook shares suffered another day of less than stellar trading. Prices reached a high of $35.59 and dipped to $30.94 at their lowest. The Nasdaq concluded regular trading with the shares at $31.12 and after hours activity reflects a similar price so far. Those who have been keeping track will recall that stock prices climbed to $45 early on the first day of trading, but quickly settled back down to their $38 target price.

    Since Monday Facebook shares have been steadily working their way down to the $30 price range. Yesterday trading closed at $34, but today marks their lowest closing price so far. Not only do the numbers reflect a lack of demand for Facebook, but the botched communication issue on opening day of the IPO has created some stress around the integrity of the public markets.

    Securities and Exchange Commission Chairman Mary Schapiro announced earlier today that they would be looking into problems surrounding the offering in an effort to restore confidence in the market. There hasn’t been any word on exactly what the SEC is looking at, but I expect we will hear more from the SEC as the week progresses.

    Mary Schapiro commented on the Facebook IPO to some reporters as she left a Senate Banking Committee hearing earlier today:

    “I think there is a lot of reason to have confidence in our markets and in the integrity of how they operate, but there are issues that we need to look at specifically with respect to Facebook,”

    I suppose there’s really only a few things she could be referring to as far as an investigation might go. The first being Nasdaq’s highly-publicized communication breakdown between them and the big bank trading desks. If your remember, it left everyone involved wondering who bought what, and at what price. So that probably deserves a second look.

    The next thing the SEC might want to investigate is Morgan Stanley’s financial forecast for Facebook revenue. Apparently a revised version was released during the IPO roadshow sometime last week. It revealed huge revenue losses for Facebook and projected into late 2012. This supposedly caused many who had the inside scoop to delay their previous plans to purchase shares of the social networking giant.

  • Mark Zuckerberg Opts for $1 Salary

    Mark Zuckerberg Opts for $1 Salary

    Facebook CEO and newlywed Mark Zuckerberg will take a $1 salary in 2013, and likewise forgo cash and stock bonuses, as well the use of Facebook services, including aircraft and financial and estate planning for his personal use – all to save on taxes.

    Other notable tech execs who receive a $1 salary include Apple’s late Steve Jobs, Oracle’s Larry Ellison, HP’s Meg Whitman, and Google leaders Sergey Brin, Larry Page and Eric Schmidt. Executives do this sort of thing to fall into different tax brackets. Zuckerberg’s salary in 2012 is $600,000, up from $500,000 in 2011, which has a payroll tax of 35%. Though, with a $1 salary and stock options instead, he only pays a capital gains tax, which is 15% at present.

    There’s a common belief that the wealthy sometimes live off interest, but in Zuckerberg’s case, it would be better to live off debt and municipal bonds. He could get a home equity line of credit, which isn’t taxable, and live off of that, while his stocks grow. And interest on said equity can offset any separate income.

    There’s been a lot of speculation concerning why Facebook’s stock hasn’t skyrocketed since the Friday IPO. NASDAQ reporting errors, poor ad monetization, hoodies, weddings, etc., were all mentioned. When it comes down to it, it would appear that Facebook set the initial price of the stock too high. Realistically, a company with over 900 million “customers” isn’t exactly going anywhere anytime soon. It will be interesting to see how Facebook stock does after posting its earnings report in the coming months. For extensive coverage on Facebook’s IPO, go here.

  • Facebook Shares Hit Below $31 at 18% Decline

    Today the market on Facebook shares opened at $32.91, even lower than yesterday’s $34 closing price, but as trading got underway, the trend still favored the downward spiral. As I write this article, Facebook is trading at almost 18% below the targeted $38 per share price. For about $31 you can own a piece of social networking history.

    Though Facebook stock enjoyed a momentary spike at $45 per share on opening day, the IPO has been paged by less than stellar performance and has been favoring a downward trading price since Friday’s close. But Facebook is still one of the most active stocks on the market today. Tuesday alone saw over 28 million shares traded. While demand isn’t overwhelming, as many expected, there is still a significant demand.

    There are a few factors that play into investors conservative opinions regarding Facebook shares, and at the heart of those concerns is a reduced revenue forecast from Morgan Stanley, the biggest underwriter of the deal. According to their most recent forecast, Facebook will suffer greatly from their huge surge in mobile users.

    But many experts in the industry did see this less then stellar performance coming for Facebook. While some were leery about Facebook being valued higher than 99% of the current S&P 500 index, others warned that the IPO should be delayed because of market volatility and just simply, too many changes happening at Facebook all at once.

    Overall there has not been much faith in Facebook’s $105 billion valuation. I don’t think you can expect the company to return very much to its shareholders if it is already grossly overvalued at the time of the public offering. Only time will tell if Facebook can rise above the challenges that lay before them, but right now, investors don’t want failure to be at their expense.

  • How Low Can Facebook Stock Go?

    How Low Can Facebook Stock Go?

    Facebook stock closed at $34.03 per share yesterday, and some speculate that there truly is no limit on how low it can go. Several factors have likely contributed to the sensational IPO’s less than stellar performance. NASDAQ had allegedly suffered a reporting problem early on, Facebook has been said to be unable to properly monetize its ad content, and may have possibly even filed a reduced guidance, reporting that the future of the company might be grim – some investors might even contribute the decline in stock to Zuckerberg’s hoodies he likes to wear, and that fact that he opted to get married in California, instead of ringing in the opening bell on the NASDAQ floor himself.

    Some say the shares were plainly too expensive, at $38 a pop, and with the technical issues of NASDAQ, trading should’ve been delayed. Dave Rovelli, managing director of US equity trading at Canaccord Genuity in New York, states, “They shouldn’t have opened until 1 o’clock (Friday), until they fixed the glitch.” Rovelli adds, “All the buy-side institutions are shorting it. You can get a borrow on it and everyone’s leaning all over it. There’s no bottom – The next catalyst is going to be earnings, which is three months away. So there’s no reason to jump in here. You’re catching a falling knife.”

    As the smoke clears surrounding the IPO event, there’s really no telling what will happen with Facebook’s stock, as months will pass before the company submits a quarterly earnings report. Until then, investors will be more realistically looking at the company. Phil Silverman, managing partner at Kingsview Capital in New York, states, “Unless you really want it in your portfolio I would wait for stability – It was a total fiasco on Friday. I was really surprised it went down. It just showed you that at this point there’s time to buy.” Still, Facebook does have 901 million users, and if it sorts out a better way of running ads, especially for Facebook mobile, there is nothing barring the social network from making huge gains.

  • Facebook IPO: Underwriters Fail to Prop Up Demand

    Facebook IPO: Underwriters Fail to Prop Up Demand

    After Friday’s botched Facebook IPO, where trading prices barely exceeded the $38 per share target price, things looked even worse yesterday. The market closed at just over $34 per share for Facebook. Now many banks offering the stock say they were bombarded with too many shares the day of the IPO.

    According to the Wall Street Journal, it is common practice for many banks to ask for twice as many shares as they actually want in a big tech IPO like this, because the typical result is they get half as many as they ask for. In this case those banks actually got what they asked for and more. The sudden availability of shares had a devastating effect on some of the institutions involved.

    An anonymous hedge fund manager commented to the Wall Street Journal:

    “This has been a train wreck,”

    The relatively large number of shares available combined with an increased per share price and a very recent reduction in forecasted revenue growth caused retail and investor demand to suffer greatly. Offering fewer shares at a 10% lower price could have made a dramatic difference in the performance of Facebook trading.

    Michael Pachter, an analyst at Wedbush Securities comments on the Facebook IPO:

    “The underwriters completely screwed this up,”

    “should have been half as big as it was, and it would have closed at $45.”

    As we reported earlier today, Morgan Stanley had some help from an allegedly suppressed reduced revenue forecast and may have actually bought up fewer shares of the stock to help boost the IPO than would normally be expected. This may have caused there to be even less demand by leaving more shares available, but earning them more in trading fees. Of course, none of Morgan Stanley’s approach during the IPO has been verified, so we are left wondering what exactly happened to cause the shares to perform so poorly.

    We will be watching Facebook trading closely again today. Hopefully the market will close much closer to that $38 per share target price. Check back regularly for breaking news and updates.

  • Facebook Apologizes for Deleting Photos

    Facebook, presently under a scanning electron microscope as the smoke clears post-IPO, is now under fire for allegedly removing photos posted of a child with a congenital birth defect. Hundreds of users had been sharing photos of Grayson James Walker, who was born with anencephaly, a neural tube birth defect, only to have the pictures removed. His mother Heather was aware there was a small amount of time, and arranged for a photographer to come take some pictures, some with the baby wearing a hat, some exposing the defect.

    Some of those who moderate this sort of content are oDesk employees that Facebook employs for a dollar an hour all over the world. It is evident that particular photos of the child might’ve prompted some deletions. At last count, moderators remove roughly 4 billion articles of content posted by Facebook’s 900+ million users, most falling under categories of pornography, racism and violence. After the photos of Grayson were deleted, Heather re-uploaded them, which led to a temporary ban form the site. Heather made a statement to KCTV in Kansas City, “They allow people to post almost nude pictures of themselves, profanity, and so many other things but I’m not allowed to share a picture of God’s beautiful creation.”

    Facebook responded, stating, “Upon investigation, we concluded the photo does not violate our guidelines and was removed in error.” The Social Network added, alluding to its moderation hovels it bankrolls worldwide, “a billion people share more than 300 million photos a day. Our policies are enforced by a team of reviewers in several offices across the globe – This team looks at hundreds of thousands of reports every week, and as you might expect, occasionally, we make a mistake and remove a piece of content we shouldn’t have. We extend our deepest condolences to the family and we sincerely apologize for any inconvenience.”

    What Facebook likely meant to say is that sometimes porno, racism and violence makes it past the eyes of those workers making $1 an hour, and that said workers likely didn’t know what to do with some of the possibly graphic photos in question. Below is a tribute:

  • Nasdaq’s Fallout from the Fubar Facebook IPO

    Given that everyone was so excited and looking to the future with Facebook’s initial public offering on Friday, there has been a surprising absence of good news to come out of the it since it happened. It’s not even that there’s an absence of good news but an overwhelming pall of bad news. Friday stumbled out of the gates and never really caught up, ending in a flat day for Facebook shares. Yesterday produced even less palatable morsels as the afternoon ended disappointingly with shares trading for 11% less than the IPO price.

    Those technical problems hindering Facebook’s IPO seem to have left a lot of people holding onto significant financial losses and, according to the Wall Street Journal, many brokers and traders are calling for Nasdaq OMX Group, the company that owns the operates the Nasdaq, to recompense for those losses.

    Nasdaq OMX has said it will use $10 million from the Facebook shares the exchange owns to make up for some of the losses endured by investors the past two trading days. But even that’s not expected to cover all of the fumbled trades because, according to Bob Griefeld, Nasdaq OMX’s chief executive, there simply aren’t enough shares available at the price sought by brokers.

    None of this exactly restores confidence in Facebook shares or Nasdaq OMX’s reputation. Just ask George Brady. He bought 1,000 shares of Facebook soon after they became available but had his purchase stall out on his Charles Schwab account. Facebook shares had already started to dip and yet he was still standing out in the cold.

    Then, six hours of silence followed. At around 6:14 p.m, Schwab told him that he had bought the shares at $40 and that he still held them, despite the cancellation request.

    “I was stuck for six hours trying to figure out whether I owned this dog or not,” said Mr. Brady, who lost $2,775 when he sold his shares on Monday. He says he has been in touch with Schwab and has contacted the SEC.

    As terrible as it is to lose almost $3,000 on what was heralded as a sure-bet by many speculators, Brady should probably be glad he sold off his shares on Monday and swallowed the loss that he had then because today doesn’t look much better. As of writing this, Facebook shares opened 7.41% down from yesterday and are slowly slipping down to the $30 mark.

    As bad as that $3,000 loss is, it could be worse. Brady’s name could be Mark Zuckerberg and he could’ve lost $2 billion yesterday.

  • Facebook IPO: Big Bank’s Hidden Revenue Forecast

    It’s not really news to anyone at this point, but the much anticipated Facebook IPO has been a big letdown for almost everybody involved. Of course, we think it began with Nasdaq’s monumental big trading desk communication breakdown, but Reuters is now reporting that things were headed south early last week during the IPO roadshow.

    Apparently Morgan Stanley’s Scott Devitt, the bank’s consumer Internet analyst, was in the process of reducing Facebook’s revenuer forecast just days before the IPO actually kicked off. The discovery of lower than expected revenue growth coincided with Facebook updating their SEC S-1 stating that users rapid shift to mobile was a threat to earnings.

    So the end result was that many investors at the big banks had knowledge that Facebook was expected to perform poorer than previously expected, but many other investors were left in the dark. The drastic cuts came not only from Facebook’s quarterly earnings forecast but also the year-long projections as well. The main gist of commentary from hedge fund managers and seasoned veterans of tech IPO’s suggests that it is highly unusual for revenue projections to change so dramatically once an investor roadshow is underway.

    Here’s a collection of quotes from insiders who chose not to be identified regarding the Facebook IPO and all of this decreased forecast nonsense:

    “This was done during the roadshow – I’ve never seen that before in 10 years,”

    “It’s very rare to cut forecasts in the middle of the IPO process,”

    “That deceleration freaked a lot of people out,”

    It’s a little confusing on if anybody really did anything wrong, but it’s clear that many investors were scared off by poor projections, while others were left completely in the dark. I guess the real mystery will come on Facebook’s end. Will they overcome their mobile advertising challenge or succumb to the fate laid out for them in the financial forecasts. The Securities and Exchange Commission is investigating other issues surrounding the IPO and I am sure the revenue forecasts will pop up their radar during the course of those inquiries.

  • Facebook Denies Lifting Ban on Minors

    Facebook Denies Lifting Ban on Minors

    As investors wonder why Facebook stock isn’t skyrocketing, with some suggesting that the social network was aware of potential problems by possibly filing a rumored reduced guidance, which is essentially a bad forecast of future business – now another rumor surrounds the sensational IPO – that Facebook plans to lift the ban on under-thirteen-year-olds joining the site. According to an interview over the weekend, a senior Facebook official claimed that the platform plans to allow tweens and under to log on to the site, citing that many do so anyway.

    Facebook promptly asserted their stance, stating, “All we have said is what we have been saying for months – that minors on Facebook and the internet is an important issue and we want to work with the broader industry to look at ways of keeping minors safe.” Though Simon Milner, head of policy in Britain for Facebook, points out that users under 13 clearly log on to the network, but also that Facebook makes attempts to educate the young users. A spokesperson for Facebook adds, “An important objective of Facebook’s work in education is improving the relevance of computer science skills amongst school leavers and graduates in the UK – This is vital for our industry, and for the wider economy.”

    Facebook presently has roughly 901 million users, and extra tweens would likely put it past that 1 billion mark, but likely at a cost. Facebook is a place for adults to go to get their feelings hurt, whether prompted by vague algorithmic social intrigue, or tanking stock prices. Sure, kids can perhaps learn how to operate the internet better, but the mention of boosting computer science skills by having an account is a bit far-fetched. Facebook appears to agree, and one still has to be 13 to join the site. Also, developing personalities might likely be better off conducting their social experiments in a non-digital realm.

  • Facebook Daily Trading Ends At $34.03 Per Share

    Facebook ended their first day of trading without underwriters propping them up and stock prices closed at nearly 11% below their targeted $38 per share price. Prices have been fluctuating all day, but the general trend suggests a $30 to $34 price range might have better suited the IPO.

    As we reported earlier, Friday’s trading was plagued by poor sales and a communication issue that delayed the start of the IPO by thirty minutes. Since todays trading didn’t reflect a renewed interest in owning a piece of the social giant, I think we can expect to see some variety of action from Facebook and its underwriters in the days to come. We have yet to hear any official words from Facebook on the lackluster IPO launch, but it sounds like CEO Mark Zuckerberg might have his mind elsewhere for the next couple of days.

    According to CBS Money Watch, the Facebook IPO was a success based on the fact that it closed so closely to the $38 per share target price on Friday. This indicates it is fairly priced and creating a modest demand. Others believe the IPO was a failure due to the fact that underwriters had to buy the stock to keep trading up to the $38 price.

    Now that that period is over and we see trading trending more around the $34 price range, I will be curious to see what attitude the market takes. If you remember, many industry experts have been warning that Facebook is way overvalued already and therefor not a good investment as the numbers stand right now.

    I guess we’ll see what tomorrow brings and hear what analysts have to say about Facebook closing at $34 today. As I’ve already said, I expect some kind of action, but maybe we are all just over analyzing the issue, and Facebook is doing just fine. After all, the Nasdaq says the IPO was a success overall, just not as spectacular as some would have hoped.

  • Are Facebook Shares Just Too Pricey? [Twitter Reaction]

    What’s one of the first things you try if something isn’t selling well? Did you say discounts? Of course, Facebook has to be selling poorly because it just costs too much. I think they should try out a buy one, get one deal. If you buy one share, you get the second for free. On second thought, it might really hurt the perceived value of the brand to offer such a ridiculous value.

    On the serious side, Facebook does need to do something to get demand back up for their shares. It doesn’t look good when the years most anticipated IPO can’t even maintain its target price. In this case, Facebook’s $38 per share target just isn’t holding buyer’s attention. Just before noon, stock was down in the low thirties. What is going on here? I though everyone wanted a piece of this company?

    Some investors might have been scared off by the ridiculous communication fiasco that plagued early trading on Friday. Apparently technical difficulties caused by some pre-IPO selling threw the system into disarray and nobody knew who purchased how many stocks and at what price? Sounds kind of scary with millions of dollars on the line. Then people weren’t really willing to pay much more for the shares than the $38 target price. So much for demand skyrocketing prices to $70 per share.

    There has definitely been some discussion floating around the topic of lowering prices to create greater demand. By no means is it coming from anyone official, but it certainly seems to make sense to some industry analysts. The Street released a video featuring their market researcher, Stephanie Link addressing the IPO and the value Facebook offers investors at a lower trading price.

    Take a look:

    Obviously we can’t hold this discussion without including the valuable insight of interested parties on Twitter:

    Luís Ramalho
    @luisramalho     Facebook closed just 23 cents above its IPO price — $38.23. I guess it was indeed too expensive. Glad I didn’t invest my life savings 🙂
    2 days ago via web · powered by @socialditto
     Reply  · Retweet  · Favorite

    Not Bill Walton
    @NotBillWalton     Facebook IPO opens at $38 a share. If that’s too expensive, you can still buy Craigslist stock in exchange for 2 used sweaters & an old sofa
    3 days ago via Echofon · powered by @socialditto
     Reply  · Retweet  · Favorite

    Oskar Garcia
    @oskargarcia     Interesting AP-CNBC poll: > half of Americans think Facebook is a fad. And many think IPO too expensive. AP: http://t.co/OspBw32B
    5 days ago via HootSuite · powered by @socialditto
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    rudy siahaan
    @siahaanrudy     16.Many investors assess that facebook IPO stock prices is too expensive. I think, yes! really!
    1 day ago via web · powered by @socialditto
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    Joseph Ruiz
    @jparuiz25     Bring back Myspace!!! Facebook IPO price set too high with hardly any upside http://t.co/R7E22bKM
    2 days ago via Twitter for Android · powered by @socialditto
     Reply  · Retweet  · Favorite

    Alok
    @Mitra_AK     #Facebook’s IPO price is too high. Wait for a better entry point if you want in. It’s great for traders & institutions that got in Pre IPO.
    3 days ago via web · powered by @socialditto
     Reply  · Retweet  · Favorite

    Yunus Bani
    @yunusbani     No wonder Warren Buffet not insterested 🙂 RT @Nilambabarafi: Facebook falls sharply below usd 38 IPO Price...Now @Usd 33.....Ooouuch!
    4 hours ago via UberSocial for BlackBerry · powered by @socialditto
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  • Facebook Stock Falls 13% Below $38 Offering Price

    Uh Oh! Facebook still isn’t delivering on the demand the company and its underwriters were hoping for. In fact, It’s currently selling for more than 13% below its $38 per share target price. That’s right, you can own a piece of social networking history for somewhere in the neighborhood of $25, depending on when you buy. Starting first thing this morning, . It has been fluctuating throughout the morning, but the general trend is a downward spiral.

    If you remember back to Friday, things were already off to an abysmal start when Nasdaq suffered a communication problem and wasn’t sending accurate information to big bank trading desks. This was followed by less than satisfactory trading performance by the IPO’s underwriters. Prices barely reached $45 per share and, as many had predicted, the market closed right around the initial $38 per share price.

    What does this mean for Facebook’s over $100+ billion valuation? Well, it’s too early to say. They need to get the demand for those shares back up. The best thing the company can do right now is concentrate on attracting clients to their advertising platform and work on refining their mobile strategy. Just before Friday’s IPO, General Motors pulled all of their advertising from Facebook, claiming that the ad space didn’t deliver.

    So it’s safe to say that Facebook’s much anticipated IPO is off to a really poor start. Stock prices are headed downward, the Nasdaq screwed up communication during the opening moments, and GM says the ad space just isn’t worth the money. Oh yes, and now the Securities and Exchange Commission is investigating the entire matter. Tomorrow is another day, but right now, things don’t look so good. Check back for frequent updates on the Facebook IPO.

  • Who’s Holding All The Facebook Shares?

    Who’s Holding All The Facebook Shares?

    Interested in Facebook stock? You are not alone. Despite some technical difficulty and lower than expected trading on their IPO launch date, Facebook is still one the hottest stocks being traded on the Nasdaq today.

    As many could have guessed, Facebook’s IPO brings an interest in public trading that reaches far beyond your typical investor. In fact, small investors, or what are often referred to to as retail investors, are expected to have more demand for the company than any other public offering in history. What does that mean? Simply put, the general public has a real interest in owning a piece of Facebook. Early estimates say the general public could end up owning as much as 20% of the company.

    So I guess the question for small investors is, how can I get my hands on some Facebook shares? Facebook’s official documents filed with the Securities and Exchange Commission tell us the answer to that exact question. They list all the available shares and who has them. Obviously some of these big banks only cater to big investors. For instance, Morgan Stanley and J.P. Morgan don’t have an interest in selling you twenty shares, but E-Trade, who carries over 210,000 shares, would be.

    Anyway, take a look at who’s carrying the shares. If you’re not looking, it is still interesting to see who’s profiting off the Facebook IPO. Remember, anyone who’s offering and makes sales, also makes commissions and fees off their work. IPO’s could makes some people very rich–aside from the companies themselves.

    These are the Underwriters who offer shares in Facebook:

    * Morgan Stanley: 162,174,942
    * J.P. Morgan: 84,878,573
    * Goldman Sachs: 63,185,042
    * Merrill Lynch: 27,380,185
    * Barclays Capital: 27,380,185
    * Citigroup Global Markets: 9,477,755
    * Credit Suisse Securities: 9,477,755
    * Deutsche Bank Securities: 9,477,755
    * Allen & Co.: 8,424,672
    * RBC Capital Markets: 4,212,336
    * Wells Fargo Securities: 4,212,336
    * Blaylock Robert Van: 673,974
    * CastleOak Securities: 673,974
    * Lebenthal & Co.: 673,974
    * Loop Capital Markets: 673,974
    * M.R. Beal & Co.: 673,974
    * Muriel Siebert & Co.: 673,974
    * C.L. King & Associates: 631,850
    * Samuel A. Ramirez & Co.: 631,850
    * The Williams Capital Group: 589,727
    * BMO Capital Markets: 421,234
    * Cabrera Capital Markets: 421,234
    * Cowen & Co.: 421,234
    * Lazard Capital Markets: 421,234
    * Macquarie Capital (USA): 421,234
    * Oppenheimer & Co.: 421,234
    * Pacific Crest Securities: 421,234
    * Piper Jaffray & Co.: 421,234
    * Raymond James & Associates: 421,234
    * Stifel, Nicolaus & Co.: 421,234
    * William Blair & Co.: 421,234
    * E*Trade Securities: 210,617
    * Itaú BBA USA Securities: 210,617
    Total: 421,233,615 shares

  • Tech Stocks: Nasdaq Embarrassed by Facebook IPO Hiccups

    Tech stocks IPO auctions will undergo a few necessary changes after a delay caused Facebook shares to begin trading 30 minutes after the scheduled 11am start time. CEO Robert Greifeld believes that the delay didn’t lead to what many believe was a disappointing debut for the social networking company, though he still feels “humbly embarrassed” by the entire ordeal.

    Facebook stock closed at $38.23, which is only 23 cents above where it began. Although the price jumped a bit during the day on Friday, the IPO ultimately couldn’t live up to the hype. However, some analysts believe that the shares were priced just right, which is why their value didn’t see any significant increases over the course of the business day.

    Regarding the snafu, Greifeld stated, “It would lead a reasonable person to conclude that it didn’t have an impact on the stock price. It was quite successful, but clearly we’re not happy with our performance.” Over all, the situation may have affected nearly 30 million orders.

    As a result, Nasdaq board members gathered on Saturday to discuss potential changes to its IPO auction process. This might be a smart move, as they have been under fire from critics and investors who claim that one of the biggest debuts in history was effectively bungled by the delay. Some have stated that they couldn’t confirm their bids until much later in the day.

    The Securities and Exchange Commission is rumored to be investigating the matter.

  • Facebook IPO’s Poor Performance Blamed On Software

    Friday started out pretty exciting as Facebook shares started trading. The feelings of joy soon turned to disappointment, however, as Facebook’s share price never really went anywhere. The question then turned to what caused the poor performance.

    To help answer that question, Nasdaq CEO Robert Greifield took to a conference call yesterday to clarify what exactly went wrong on Friday. Bloomberg reports that Greifield blamed the poor performance on the software used to power the computers that were doing the trading.

    The main problem seems to have started occurring after Morgan Stanley sold 421 million shares of Facebook Thursday night. The trade request apparently disturbed the auction process and threw everything into a loop. Nasdaq had to intervene to get the auction rolling at 11:30 a.m.

    The mix up had Nasdaq ending up with 5,000 shares of Facebook. They sold those shares for $10 million but are asking for permission to use the money to repay investors that never received their shares on Friday.

    It would appear that underwriters kept the share price from falling below $38 on opening day. If it had dropped below $38, it would have been disastrous for first day trades. The less than stellar first day already knocked Zynga’s share price down to little below $8, so it’s painful to imagine what a worse day for Facebook would cause.

    Regardless of Facebook’s poor performance on Friday, Nasdaq still saw a lot of action thanks to the company. Bloomberg calculated the numbers and found that Facebook shares traded 582.5 million times on Friday. That number accounted for 6.6 percent of total U.S. exchanges.

    It’s pretty obvious that Facebook is going to remain a hotly traded company for the months, and hopefully years to come. It has already attracted the largest number of individual investors ever and it’s going to be really popular with a lot of people.

    I think that Facebook is one of those companies that people have a lot of faith in. If the problems didn’t plague its opening day on the markets, I’m sure Facebook would have closed much higher than it actually did. I would say that it’s not yet fair to count Facebook out. We should give it the rest of this week to see how well it does.

    Facebook is currently trading for $34 per share. It’s been slowly climbing since I began writing this, so we’ll keep watching for any major changes. We’ll let you know if Facebook rises to the top of the mountain or sinks beneath the sea. Either way, things are just starting to get interesting.

  • Facebook’s Rumored Reduced Guidance

    Facebook’s Rumored Reduced Guidance

    During the time before Facebook’s IPO, Mark Zuckerberg and Co. had been making their rounds to woo investors, and to better explain the direction of their company. Some of the suits feared Zuckerberg’s fashion sense, and some questioned Facebook’s viability regarding ad content, which the CEO pointed out as being the number one priority of the social network in 2012. Still, Henry Blodget at Business Insider has pointed out that Facebook might’ve reduced its earnings guidance while making these rounds before the IPO – something that should really anger buyers, beyond NASDAQ’s reports of some sort of communication breakdown during the trading of Facebook shares, which is perhaps why the stock really didn’t perform well on Friday.

    The aforementioned earnings guidance is a company’s forecast of how good business will be in the future. These sorts of forecasts directly affect trading, as they afford buyers the most current information. Facebook never officially submitted an earnings guidance, though Blodget has noticed a couple of mentions to where the company might’ve not only submitted, but also changed their forecast with a reduced guidance during their road show, something that would indicate a drastic change in business. This is something investors should’ve been made aware of. Though, this is all speculative.

    An earnings guidance is highly material information, something that any investor should remain clear on. It was never officially stated if Facebook even submitted a guidance in the first place, though now some outlets are reporting an actual reduced guidance. Reuters had recently posted: Facebook also altered its guidance for research earnings last week, during the road show, a rare and disruptive move. Though, who knows? It seems unlikely that Facebook would be so bold to hide this sort of information on the eve of such a sensational IPO. The interent harbors all kinds of disinformation. Perhaps today investors will get a better idea of how Facebook stock might do, if NASDAQ is able to report correctly.

  • Facebook’s Less Than Stellar IPO Performance

    Looking back to Friday, the day of the big Facebook IPO, we reported that there was some sort of technical issue that hampered trading early on. According to sources on the inside, it could all be traced back to a communication breakdown that left the big trading desks wondering, who bought what, and at what price. I would guess that makes it difficult to gage success.

    According to Nasdaq executive Robert Greifeld, the offering was an imperfect success. He verified there was indeed a communication issue that caused some confusion at the beginning of the day, but that there was no evidence to suggest it had an impact overall.

    Greifeld comments on the events of Friday’s Facebook IPO launch:

    “It would lead a reasonable person to conclude that it didn’t have an impact on the stock price,”

    “It was quite successful, but clearly we’re not happy with our performance,”

    As you can imagine, many investors were turned off by Facebook’s less than stellar showing. Reports now tell that shares just barely broke $42. As of an hour ago, Facebook is actually trading under the originally negotiated $38 per share price. I bet many are questing that $105 billion valuation now.

    But, I think it’s is way too early to be calling this thing a success or an infinite flop. As the old cliche says, only time will tell. While it is true that Facebook’s only true source of revenue is advertising, the same can also be said for almost any other media resource we enjoy today. It’s America folks, if you don’t buy products, everything falls apart. The only difference is, Facebook is now one of those products.

    Apparently the Securities and Exchange Commission, and Nasdaq are investigating the cause of the breakdown, but I doubt we’ll hear any big news back from either party. We will be keeping an eye on Facebook shares today, and you can check back hear for regular news and updates on the IPO.

  • Rupert Murdoch Congratulates Zuckerberg on IPO

    Rupert Murdoch Congratulates Zuckerberg on IPO

    Media mogul Rupert Murdoch congratulated Mark Zuckerberg on Facebook’s IPO, and urged him to continue working. Murdoch, who in the past lamented a lack of civility on Twitter, still takes to the platform to project his varied musings. Here he wishes Zuckerberg happiness:

    Rupert Murdoch
    @rupertmurdoch     Warm congrats to Mark Zuckerberg. Much happiness, but don’t stop working!
    21 hours ago via Twitter for iPad · powered by @socialditto
     Reply  · Retweet  · Favorite

    Of course, many Twitterers chimed in. Below are some tweets worthy of note:

    Paul
    @wicksta1     @rupertmurdoch if he keeps working this Facebook thing might become as successful as Myspace!
    21 hours ago via web · powered by @socialditto
     Reply  · Retweet  · Favorite

    This user, likely aware of Facebook’s possible issue with monetizing effective ad content, especially for mobile, alludes to the social network possibly devolving into Myspace. Though Zuckerberg has pointed out that Facebook’s mobile app is the number one priority for 2012, and might even write some of the code himself regarding any alterations. And another comments on Facebook’s possible ad problem:

    Adrian StClair Burke
    @adrian_scb     @rupertmurdoch How will Facebook provide value for shareholders when almost nobody pays attention to the ads, it’s main revenue?
    21 hours ago via web · powered by @socialditto
     Reply  · Retweet  · Favorite

    This user doesn’t like Murdoch:

    NO I.D
    @briso1873     @rupertmurdoch can you not crawl back under your stone ! Your not fit to use twitter ! Corrupt father & son & @alexsalmond!
    20 hours ago via Echofon · powered by @socialditto
     Reply  · Retweet  · Favorite

    And, just after Zuckerberg’s marriage was announced, the user below urges him to not allow his “ruddy” wife to get in the way:

    кошка
    @koshkatze     @rupertmurdoch yeah dont let that ruddy wife get in the way eh!!!
    21 hours ago via Twitter for Android · powered by @socialditto
     Reply  · Retweet  · Favorite

    Zuckerberg, just after filing the IPO, married Priscilla Chan in a surprise ceremony.

  • Mark Zuckerberg Gets Married After Big Facebook IPO

    Mark Zuckerberg Gets Married After Big Facebook IPO

    Mark Zuckerberg must be on top of the world right now. Facebook went public on Friday to the tune of $42 a share, even though it settled to $38 after a not so hot day.Regardless, it’s still a reason to celebrate. Zuckerberg wasn’t going to let the good times stop at the IPO though as the founder of Facebook also got married this weekend.

    Zuckerberg updated his Facebook Timeline to show a picture of himself with long-time girlfriend, and now bride, Priscilla Chan. The picture of the newly wed couple has already attracted over 700,00 likes and over 600 comments. While it doesn’t break any records, it shows that the Facebook community is super excited for Zuckerberg. All the comments are full of good will and congratulations instead of the jokes that I was kind of expecting.

    According to Daily Finance, the wedding ceremony was set to friends only. It took place at Zuckerberg’s home in Palo Alto surrounded by only 100 friends and family. The ring given to Chan was adorned with a “very simple ruby.” Here I was hoping that he was going to give her a ring with a sapphire shaped in the Facebook logo.

    The funny thing is that most who attended the wedding were completely caught off guard. It would appear that the couple was waiting for Chan to graduate medical school so the date of the marriage was always in flux. It appears that the guests were invited under the pretense of a party, but found out it was a wedding after they arrived.

    Like any good relationship, the marriage has become Facebook official. Both Zuckerberg and Chan have updated their profiles to show that they tied the knot.

    We here at WebProNews wish the newlywed couple the best of luck in the coming years. Here’s hoping we will soon be able to report on some little Zuckerbergs running around the Facebook HQ causing all kinds of chaos.

  • Facebook Acquires Karma, A “Social And Mobile Gifting” Service

    It’s been quite the busy day for Facebook. You may have heard: the company went public. They also acquired Karma, which is described as a social and mobile gifting service.

    The way Karma works, is: you send a gift, with a card, and Karma will notify your friend via text messager, email or Facebook. They can accept the gift as is or swap it for something else, or donate the value of it to charity. They enter their address, and Karma sends the gift.

    The company was founded in 2011.

    It’s going to be interesting to see how Facebook uses this. It could be a pretty interesting layer to Facebook as an ecommerce platform.

    Facebook released the following statement:

    “We’ve been really impressed with the Karma team and all they accomplished in such a short time. This acquisition combines Karma’s passion and innovative mobile app with Facebook’s platform to help people connect and share in new and meaningful ways.”

    A post from the Karma team on the Karma blog says, “Over the last year, we’ve built a new e-commerce platform from the ground up. We’ve been honored to partner with amazing brands to create a curated catalog of products. We made those products instantly giftable in a brand new way. And we harnessed the power of Facebook’s social network to ensure you never miss a chance to show someone you care. The phenomenal response and feedback we’ve heard from customers has more than exceeded our expectations. And we’re just getting started — today we take social gifting to the next level.”

    “We’re thrilled to announce that Karma has been acquired by Facebook,” the post continues. “The service that Karma provides will continue to operate in full force. By combining the incredible passion of our community with Facebook’s platform we can delight users in new and meaningful ways. As we say … only good things will follow.”

    No word so far on the terms of the deal.

  • Facebook’s Big Day: The Highlights

    Facebook’s Big Day: The Highlights

    The Facebook IPO has been dominating the news today. Unless you were present at NASDAQ or Facebook’s Menlo Park, California headquarters, it’s probable that you may have missed some details of the drama. It’s also very likely that you had concerns or obligations other than keeping up on Facebook news today.

    Luckily, the New York Post has been live-blogging the momentous occasion for those of us who haven’t become billionaires today. To familiarize yourself with the topic and arm yourself with some talking points for the inevitable Facebook-centered conversations this weekend, here are some of the highlights of Facebook’s big day:

    • Facebook priced its shares at $38 each, the high end of predicted price ranges. By offering over 421 million shares, Facebook raised around $16 billion dollars.
    • This price values Facebook at $104 billion, or about half the value of Wal-Mart.
    • Facebook celebrated the IPO with an all-night employee “hackathon” complete with beer, street hockey, and LEGOS.
    • Mark Zuckerberg, Facebook’s founder and CEO, sold 30 million shares today, making around $1.15 billion in cash. He also controls 32% of Facebook’s shares, making his net worth more than $19 billion. Zuckerberg is now the 29th richest person in the world.
    • Before the NASDAQ opened for the day, Zuckerberg said the following to his employees:

      “Right now this all seems like a big deal. Going public is an important milestone in our history. But here’s the thing: Our mission isn’t to be a public company. Our mission is to make the world more open and connected. In the past eight years, all of you out there have built the largest community in the history of the world. You’ve done amazing things that we never would have dreamed of, and I can’t wait to see what you guys all do going forward.”

    • Watch as the 28-year-old Zuckerberg presses a button and makes himself a multi-billionaire:

      Watch live streaming video from nasdaq at livestream.com
    • Zuckerberg was given a commemorative hoodie from NASDAQ to mark the occasion.
    • Facebook stock was set to begin trading at 11 am, but was delayed 30 minutes. NASDAQ stated the delay was due to technical glitches caused by the incredible demand for the stock.
    • Facebook stock began trading at 11:30 am for $42.25 per share, but quickly dipped back down to around $38. The stock then climbed back to hover around $40 for most of the day, before ending the day right back at its original value: $38.18.

      A graph of Facebook's stock price on its first day
      (graph courtesy Yahoo! Finance)

    • This moderate performance disappointed many, and fell far short of some analysts’ wild expectations. Also, this weak performance may have caused game company Zynga’s stock to fall off a cliff.
    • Over 500 million Facebook shares were traded on its first day, a record for an IPO.
    • The excitement around the Facebook brand has generated the most small investor demand for an IPO in history. This is something that billionaire Mark Cuban warned against on Thursday.
    • Facebook still hasn’t shed it’s privacy issues. On today, of all days, a San Jose judge allowed a class-action lawsuit against Facebook to proceed. The lawsuit concerns Facebook’s tracking of users who are not logged into its website, but a Facebook spokesperson stated that “We believe this complaint is without merit and we will fight it vigorously.”

    There you have it. In the end, the unbelievable hype over Facebook’s stock might have prevented it from soaring too high, and investors were responsible and restrained with their trading. What comes next for Facebook’s stock is unclear, but what is clear is that the company now has investors to please on a quarterly basis. That means Facebook will be pushing hard to increase its revenue using every possible method. What that will mean for Facebook users could end up being the most interesting story of 2012.

    (via New York Post)