Facebook shares make their biggest jump since the IPO disaster
Facebook's shares zoomed yesterday, making their biggest daily gain since the company's IPO disaster in May.
Facebook shares rise
The rise followed the social network's Q3 earnings report that "modestly beat Wall Street expectations with accelerating advertising revenue, " said the Wall Street Journal.
The stock was up 20% to $23.23 at the close. At Tuesday's close, the shares had fallen 47% from their IPO price of $38.
The WSJ said the results came amid intense investor scrutiny of Facebook's growth, and suggested the company is making headway on the selling of ads on mobile devices.
"They're moving in the right direction, and it seems to be that they're picking up speed," said Kevin Landis, chief investment officer of Firsthand Capital Management, in San Jose, California. His firm bought 600,000 Facebook shares before the IPO.
"They are figuring out how to turn it into a great money-making platform. They're starting to get more revenue on each mobile user, and the mobile users are spending more time on Facebook."
On Facebook's earnings call on Tuesday, Chief Executive Mark Zuckerberg defended the potential of the company's mobile business.
"I think our opportunity on mobile is the most misunderstood aspect of Facebook today," he said. "Most people underestimate how fundamentally good the trend toward mobile can be for Facebook."
The company started to roll out ads to its 604 million mobile users in March. A programme called "sponsored posts," inserts paid marketer messages into the home screen of its mobile apps.