Mark Zuckerberg admits Facebook stock tumble is ‘painful’ to watch
Mark Zuckerberg admits Facebook stock tumble is ‘painful’ to watch
Mark Zuckerberg, CEO of Facebook
Picture: Getty
Last Updated: 2:08PM BST 17/08/2012
Mark Zuckerberg has reportedly admitted Facebook’s stock market tumble has been “painful” to watch, at a meeting designed to boost staff morale.
He gathered staff to discuss the issue ahead of the release of an extra 271 million shares on Thursday, which cut Facebook shares to just $19.87, almost half their $38 flotation price, according to The Wall Street Journal.
Until the IPO in May, Mr Zuckerberg publicly professed little interest in the value of his creation and encouraged staff who had been awarded generous share options to adopt the same focus on developing it products. He posted a picture saying “stay focused, keep shipping” on his Facebook profile on the day of the flotation.
Witnesses said that at the meeting the 28-year-old chief executive was asked if staff were allowed to talk about the firm’s troubles on Wall Street. At other Silicon Valley firms where many employees own stock, such as Apple, the company share price is standard small talk in canteens and break rooms.
Mr Zuckerberg reportedly said that people should now feel comfortable talking about the issue, but still try not to focus on it.
He was forced to acknowledge Facebook’s “painful” stock market hammering, however, to employees whose options were issued at a higher price than the shares are currently trading at. Many remain unable to trade their share as a series of lock-in periods remain in force.
Thursday’s new low meant Mr Zuckerberg’s personal fortune has been slashed to about $10bn, down from estimates of almost $20bn in May.
Facebook’s stock has tumbled amid criticism that its shares were overvalued by bankers to begin with. Its maiden results, in July, revealed a revenue growth slowdown and a overall loss of $157m. The firm has also admitted it is threatened by the growth in smartphones and tablets as it has not worked out a strategy to make money from its mobile apps or mobile website.