Priced For Perfection—Facebook Proves This Time Is The Same But Worse

Facebook (FB) was priced for perfection. So it went down in flames last night—-shedding $130 billion of market cap after coughing-up some very un-fake news about its performance and outlook.

For instance, its monthly user stats (MAU) in North America and Europe, where it generates 73% of its revenue, were flat with Q4 at 617 million; and MAU was up by just 3.5% from Q2 last year.

Likewise, its forward guidance embodied a marked downshift, including:

  • operating margins of 35% in the future compared to 45-50% in recent quarters;
  • ad growth of 25% compared to recent gains of 40%; and
  • a doubling of capital spending and above the line investments.


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