Zuckerberg maps Facebook future
FACEBOOK chief executive Mark Zuckerberg soothed investors on Tuesday in his first major public appearance since the social network’s rocky initial public offering in May, breathing life into its struggling shares after hinting at new growth areas from mobile apps to search.
The 28-year-old co-founder, looking confidently casual, asked Wall Street to be patient as the company developed new products, addressed issues such as staff morale, and quashed rumours that Facebook may build a smartphone.
Facebook became the first US company to debut on stock markets with a value of more than $100 billion (about R800bn). But it has since lost half of its capitalisation as investors fret about slowing growth and the group’s challenges in making money as users shift from computers to smartphones.
Zuckerberg admitted to disappointment about his company’s crumbling share price, but argued Wall Street had yet to grasp the full potential of its fledgling mobile business.
His comments drove Facebook shares up 3 percent after hours on Tuesday to above $20, building on a 3.3 percent gain in regular trade. The stock is still well off its $38 debut price.
Speaking at San Francisco’s TechCrunch Disrupt conference, Zuckerberg highlighted Facebook’s progress in mobile over the past six months and the company’s room for growth.
While declining to offer details, Zuckerberg hinted that the company was halfway through a cycle to “retool” and offer new advertising products. He believed search could be a ripe area of growth for Facebook and was working to offer a competitive search product.
While Facebook has taken a beating on Wall Street, some of the internet industry programmers, entrepreneurs and investors who packed the aisles to watch Zuckerberg’s roughly 30-minute talk said their faith in the company was not shaken..
Zuckerberg quashed rumours that Facebook was wading into the hardware business and developing a branded phone.
Building a smartphone would be “clearly the wrong strategy for us”, he said.