Facebook shares have plummeted on their second day of trading after a closely-watched and long-awaited IPO last Friday. The marked dive fuels talks about the social network's unclear business perspective.
Facebook stocks took a dive on Monday's NASDAQ trading amid a general US market rebound. Shares of the world's biggest social network company plunged 11 percent below the initial public offering price.
Shares of the California-based firm of founder Mark Zuckerberg were changing hands at only $34 (26.54 euros) at the end of trading. This was equivalent to erasing almost ten billion worth of the company's market value, bringing the firm's overall value to $97 billion.
The lackluster performance early on Monday convinced already skeptical analysts on Wall Street and elsewhere that Facebook had been overvalued right from the start. They argued that despite its over 900 million users, the social network's business model remained suspect.
Problems all along
Although Facebook's going public on Friday had been heralded as one of the biggest Internet IPOs ever, its shares failed to rev up the market, ending just 23 cents above their $38 starting value. The banks responsible for underwriting the stock issue even had to come to the rescue by buying up shares in support of the Menlo Park giant.
But sales on Friday were also interrupted by technical problems on the NASDAQ technology stock exchange. Facebook's debut was marred by glitches which caused the stocks to be traded more than half an hour late, with some investors being unable for hours to learn whether their orders had gone through.
NASDAQ was "humbly embarrassed" by the glitches that had appeared during Facebook's first day of trading, the firm's Chief Executive Robert Greifeld told reporters on Monday.
hg,slk/gb (AP, AFP, dpa)