FACEBOOK shares continued to hurtle downwards yesterday, dropping 3.8 per cent to a new closing low of $25.87 (£16.82) – far below the $38 IPO price.
The stock, which had dipped as low as $25.75 during the day, continued to sink in after hours trading in yet another blow for the company’s uber-hyped flotation.
But Facebook could be on its way to addressing one of the main risk factors outlined in its prospectus: that it does not capitalise on its rapidly increasing number of mobile users.
The social network yesterday unveiled its first advertising product for mobile, allowing marketers to place sponsored stories in users’ news feeds on desktop and mobile devices. Just days before its IPO last month, Facebook warned investors that its users’ soaring penchant for mobile was increasing daily active users figure faster than the number of ads it can deliver, which led Morgan Stanley to downgrade its forecasts.
Meanwhile, Nasdaq is expected to outline today how it intends to compensate investors who say they were wronged by the stock exchange’s glitches during Facebook’s IPO. Traders were not sure if their attempts to buy or sell shares had been confirmed, leading some to claim losses in the high millions.
Technical glitches also marred the launch yesterday of Airtime, a new Facebook-based video network created by early Facebook investor Sean Parker.