Facebook CEO
Mark Zuckerberg shed $3.7 billion from his net worth in the two hours after the
market closed on Wednesday, as the company’s stock price sank despite
strong
third-quarter results.
Zuckerberg’s
fortune fell to $50.6 billion as of 6 p.m. Eastern time, according to FORBES
estimates. He’s still the fifth-richest person in the world, according to
FORBES, right behind Warren Buffett at number 4 and ahead of Mexican
billionaire Carlos Slim Helu at number 6. When markets closed on Wednesday,
Zuckerberg’s net worth was $54.4 billion.
This year’s
previous two earnings reports were a boon for Zuckerberg’s pocketbook. After
the company announced second-quarter results in July, a stock surge added $3.4
billion to his net worth in the hour after markets closed. In April, when first-quarter
results were announced, he gained $4.2 billion within two-and-a-half hours
after markets closed.
But today
Facebook’s stock price dipped by around 7% in after-hours trading to $118.36,
as of 6 p.m. The drop came despite the company reporting $7 billion in
quarterly revenues, up 56% from the same period a year earlier. That beat
expectations of analysts polled by Yahoo Finance, who on average expected a 44%
increase to $6.9 billion in revenues for the quarter. Net income for the
quarter hit $2.4 billion, a 166% increase from last year.
But investors
were nonetheless disappointed. Facebook has beat revenue and earnings
expectations for six quarters straight. But during the earnings call the
company said its expenses will increase in 2017, in part because users are
sharing more videos, driving up network costs. Investors may also be concerned
about the company’s suggestions this quarter that revenue growth may slow next
year.
As in previous
quarters, mobile advertising sales fueled the company’s strong performance.
About 84% of the company’s advertising revenues came from mobile, up from 78%
during the same period last year. Facebook has also continued to attract new
users, despite competition from rivals like Snapchat. Facebook reached 1.79 billion
monthly users this quarter, up 16% from a year ago, with the vast majority
logging on through mobile devices.
Facebook
shares closed at $127.26 on Wednesday, up about 22% since the beginning of the
year, but down 1.7% since Tuesday’s closing price.
msn
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