Another indication the bloom's coming off the Facebook rose
Good news, bad news report out of eMarketer with a billion-dollar revenue reduction in Facebook 2012 sales estimate.
Add another entry to the lengthening list of reduced revenue estimates for Facebook.
eMarketer said in a report issued earlier today that it has cut its 2012 revenue estimates on Facebook from more than $6 billion to around $5 billion.
In February, eMarketer estimated that Facebook's total revenues would go beyond the $6 billion mark this year, but the company's underwhelming performance in the first and second quarters of 2012 has changed the opinion of analysts.
The new estimate has Facebook's revenue at a 35.9 percent increase from 2011, according to eMarketer's forecast, but analyst expects that percentage to grow when Facebook establishes its ad exchange, and its mobile ad business.
While advertising numbers are still rising -- eMarkerter expects revenue to hit $4.23 billion, a 34.1 percent increase from 2011 -- the climb is not as significant as last year. Revenue from Facebook payments and other sources, however, are increasing quickly. This year Facebook will see $811 million from non-advertising services -- a 45.6 percent increase from last year.
The lackluster growth has fueled Facebook's poor showings in the stock market. The stock closed at $19.09 a share today, roughly half of its opening day price of $38.
The poor performance may be why Facebook supporters are shedding their stock, including co-founder Dustin Moskovitz. Moskovitz continues to drop 150,000 shares a day from his trove of millions.
Facebook's poor fiscal reputation can be traced back to a bungled opening day. The marked event just won't go away -- the Nasdaq has proposed to pay firms back in a $62 million compensation package after the stock exchange mismanaged the initial day of trading.
Knight Capital Group, a major market maker, criticized the exchange for the losses shortly after, and now the firm has weighed in on Nasdaq's plan.
Knight said it supported the proposal, but harped on Nasdaq's plan to make firms seeking compensation waive legal claims against the stock exchange.