After one year as a public company, shares of Facebook Inc. were down 33%. About five years later, the stock is doing a tad better: A 279% return from its first day of trading, and a market cap that has quadrupled.
made its debut on the Nasdaq five years ago today, with a bumpy trading debut due to a technical glitch. While the social network’s IPO has recently been used as a comparison for Snap Inc.
this year’s buzzed-about tech offering, Facebook’s trajectory shows that a company’s performance cannot be judged by its IPO or even its first year on Wall Street.
In the year following its offering, Facebook analysts were concerned that the company was overvalued and that its revenue and user numbers were not growing quickly enough. Now, Snap is facing similar issues, as the company’s March 2 debut was quickly followed by analysts saying the stock was overvalued and concerns about its user growth and competition from, funnily enough, Facebook.
Facebook stands out from the pack in the scope it offered before going public, though. Snap went public at a market capitalization of $19.7 billion. Facebook went public with a market cap of $104 billion, which has since grown to about $419.7 billion.
At the time of its IPO, Facebook had 526 million daily active users, total revenue of $1.06 billion and revenue per user of $1.21. It was already profitable, with net income of $205 million.
Compare that to Snap, which went into its March offering with 158 million recorded daily active users, revenue of $165.7 million and revenue per user of $1.05. It was not profitable, with a net loss of $169.9 million, which widened to $2.2 billion for the first quarter in its first report as a public company.
Facebook now has 1.28 billion daily active users, has added platforms such as Instagram and WhatsApp and moved toward virtual reality as well as promised innovations such as hearing with your skin.
Shares of Facebook have gained 11% in the past three months, compared with the S&P 500’s
gain of 1%.