Facebook 'Bergs' Hit Airwaves; CEO and COO Interviews on Tap this Week
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It seems Facebook’s (NASDAQ: FB) top brass is learning that it benefits them too to share a bit more. This week we may see more of them since the days prior to the IPO, as interviews with CEO Mark Zuckerberg and COO Sheryl Sandberg will be aired.
Execs at the world’s largest social networking site have been reclusive since its infamous IPO in May. Investors have likened getting Zuckerberg to say something following the IPO to pulling teeth. As the stock shed its value by more than 50% in the months following the May public offering, top officials have remained mostly mum.
So I was intrigued when I learned Zuckerberg and Sandberg would be making the media rounds this week. It reminds me of its IPO road show. For information-starved investors and market players, comments from these two will be more than welcomed.
Considering stocks trade on news, these rounds should also bode well for the company’s shares. I told you about Facebook receiving a needed bounce last week after a new, potentially lucrative, revenue-generating service was announced called Facebook Gifts. Facebook closed up almost 7% on Friday.
I expect the rally to continue on Monday when CNBC will broadcast segments of an interview with Sandberg all day. Also this week, an interview Zuckerberg granted with “Today” show co-host Matt Lauer is scheduled to air.
In mid-September, we were able to get a glimpse into the company’s challenges and successes in generating revenue, especially when it comes to the crucial mobile advertising space. Facebook dominated last year in carving out the most market share in the display ad business. However, Google (NASDAQ: GOOG) is expected to top Facebook this year, according to eMarketer, which estimates Facebook’s revenues will be about $2.2 billion compared to Google’s $2.3 billion. Yahoo, Microsoft and AOL round out the top five.
Zuckerberg sat down for an interview during TechCrunch’s Disrupt conference last month, and spoke frankly about how the company went wrong in some areas, and was successful in others. One of the most important things Zuckerberg gave heads up about is Facebook’s app on Apple’s (NASDAQ: AAPL) iPhone 5. The new iPhone allows tighter integration with Facebook services. Simply put, the integration makes it easier for users to access Facebook on the new iPhones. Now that the iPhone 5 has been released, it will be interesting to hear how Facebook’s app is faring, which I sure hope is better than Apple’s map app.
The pressure is on Facebook to monetize the increasing number of subscribers who access its site via mobile phones and tablets instead of computers. As mentioned, Facebook Gifts is important for this effort. It is the company’s first foray into eCommerce.
Facebook is also banking on Sponsored Stories, ads run in its subscribers’ news feeds, to help it increase its advertising revenues. During the second quarter earnings results conference call last month, Zuckerberg and Sandberg talked up Sponsored Stories, which generate about $1 million a day. Hopefully Sandberg will continue to give more insight on the product, including giving any updates on a lawsuit over Sponsored Stories that the company settled over the summer. Still up in the air is whether the $20 million Facebook offered to pay to settle privacy violation allegations will be approved by the judge in the case.
As the company awaits this decision, it is also readying the release of its third quarter earnings later this month. This will be just the second earnings report from the company since its May IPO. When it reported its second quarter earnings in July, it announced that it had met Wall Street estimates. However, it also had to acknowledge that revenue growth had slowed. This sent its stock lower, eventually sinking to $17.55, its 52-week low.
Then there is that pesky lock-up expiration issue, which is leading to the market being flooded with potentially more than a billion Facebook shares through May of next year. Investors have complained that the fledgling stock will be adversely affected by this much float.
Regardless of what the execs choose to discuss this week, the timing of these interviews couldn’t be better. Facebook still has a lot to prove to investors. Being more visible is exactly what many of them demand of the company once thought to be valued at $100 billion, but whose stock value has fallen 42% since it went public.
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TwillyD has no positions in the stocks mentioned above. The Motley Fool owns shares of Apple, Facebook, and Google and has the following options: long JAN 2014 $20.00 calls on Facebook. TwillyD has no positions in the stocks mentioned above. The Motley Fool owns shares of Apple, Facebook, and Google and has the following options: long JAN 2014 $20.00 calls on Facebook. Motley Fool newsletter services recommend Apple, Facebook, and Google. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. If you have questions about this post or the Fool’s blog network, click here for information.