CEO says Facebook will prove critics wrong

Describes spread of mobile devices as a positive

‘‘It’s not like this is the first up and down we have ever had,” CEO Mark Zuckerberg (right) said of Facebook’s declining stock price since its initial public offering in May.
David Paul Morris/Bloomberg News
‘‘It’s not like this is the first up and down we have ever had,” CEO Mark Zuckerberg (right) said of Facebook’s declining stock price since its initial public offering in May.

SAN FRANCISCO — Facebook CEO Mark Zuckerberg hasn’t enjoyed seeing his company’s stock get pummeled on Wall Street this summer, but he is relishing the opportunity to prove his critics wrong.

‘‘I would rather be in a cycle where people underestimate us because I’d rather be underestimated,’’ Zuckerberg said Tuesday. ‘‘I think it gives us the latitude to go out and make some big bets.’’

Zuckerberg, 28, made his remarks before a standing-room-only audience at a tech conference in San Francisco in his first interview since Facebook Inc.’s rocky initial public offering in May.


The social networking leader’s stock has lost nearly half its value since the IPO. More than $50 billion has been lopped off Facebook’s market value as the company’s shares have fallen from $38 to Tuesday’s closing price of $19.43.

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No one has lost as much as Zuckerberg, who has seen the value of his Facebook holdings fall about more than $9 billion.

Wearing a gray T-shirt, jeans, and sneakers, Zuckerberg looked at ease through his half-hour appearance. He smiled frequently and even chuckled a few times before a San Francisco audience composed largely of fellow geeks who, like him, tend to enjoy talking about computer coding and building cool products instead of business strategies.

Yet Zuckerberg clearly was aiming many of his remarks at investors. He emphasized that Facebook cared about making money as well as pursuing his mission to make the world a ‘‘more open and connected place.’’ He also repeated his belief that the company would figure out numerous ways to profit from the growing number of its 955 million worldwide users who visit Facebook through mobile applications instead of desktop computers.

Zuckerberg said the performance of Facebook’s stock ‘‘has obviously been disappointing,’’ but he said it’s a great time to ‘‘double down’’ on the company’s future.


‘‘I think it is really easy to for folks to underestimate how really fundamentally good mobile is for us,’’ Zuckerberg told his interviewer, blogger turned venture capitalist Michal Arrington, at the TechCrunch Disrupt conference.

Some investors evidently liked what Zuckerberg had to say. Facebook shares gained 66 cents, or 3.4 percent in Tuesday’s extended trading .

The ubiquity of smartphones has created problems for Facebook and other advertising-dependent Internet companies because the smaller screens on those devices have less space to show advertising around the main content.

One way Facebook will address that challenge is by inserting more ads into the mobile news feeds that highlight status updates and photos shared by users’ friends and families, according to Zuckerberg. He once again tried to shoot down recurring speculation that Facebook is developing its own smartphone like Apple and Google Inc.

‘‘It is so clearly the wrong strategy for us,’’ Zuckerberg said. ‘‘It doesn’t move the needle for us.’’


Zuckerberg indicated Facebook is likely to intensify its rivalry with Google Inc. by developing more ways to search on its website. As it is, Facebook already processes about 1 billion search requests a day, Zuckerberg said, ‘‘and we basically are not even trying.’’