Three Months back Facebook shares traded at an incredible 218 USD. The market was thus at the highest historical figures. Currently, FB shares are traded nearly 35 percent lower.

After Facebook shares manged to turn modestly green after the close, the have since slumped again, down over 3% after Zuckerberg said that in order to shift user activity to video and stories, it will have to take activity away from other kinds of social interactions which monetize a lot better. Because Zuckerberg wants Stories to be the thing that brings people back to the Facebook core app even though he admits the launch hadn’t gone quite as well as expected, and as a result the company was prioritizing that kind of activity over the traditional Facebook feed of videos, posts and news. This is a significant change as “we don’t make as much money from them yet as we do from feed ads”, according to zerohedge.com

Some more details from Bloomberg;

·        Advertisers say it increases pressure on them to do unique things frequently. You will forgive an advertiser for seeing the same ad in your news feed over and over, but if you see it multiple times in your stories, taking up the entire screen, you will be annoyed. It’s supposed to be ephemeral.

·        Advertisers aren’t used to the vertical format for “stories” ads, which is not like the ads they make for TV.

·        They don’t like that they can’t as easily get interaction from people. If you promote a post on Facebook, for example, you can see what people are saying in comments, and they might share it themselves, giving it a so-called “organic” lift. That can’t happen in Instagram.

They did not quite get that when moments ago Facebook reported a revenue miss, earnings beat (thanks to a 13% tax rate), while both daily and monthly average users missed, and rather badly at that. Here are the Q3 details:

·        Revenues of $13.73BN, below the estimate of $13.80BN

·        EPS $1.76, Above the estimate of $1.47 but as Facebook admits, this was because “its effective tax rate was 13%, which was lower than expected primarily due to the withdrawal in August of an appellate court ruling in the case of Altera Corp. v. Commissioner.”

·        Daily Active Users 1.49B, up 9% Y/Y but below the estimate of 1.557B (Under the estimate but highest in history)

·        Monthly Active Users 2.27B, up 10% but also below the estimate 2.352B (Under the estimate but highest in history)

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