Facebook Shares Reach All-Time High

Sept. 12 (Bloomberg) -- Bloomberg Television's Emily Chang reports on the Facebook team now focused on the look, feel, and functionality of ads for Facebook's business partners. (Source: Bloomberg)

Facebook Inc. (FB), operator of the world’s most popular social-networking service, climbed to an all-time high as investors bet the company will benefit from growing demand for its mobile-advertising products.

Shares rose 1 percent to $45.48 at 9:32 a.m. in New York. They had advanced 3.3 percent yesterday, surpassing the intraday high of $45 on the stock’s debut trading day in May 2012.

Chief Executive Officer Mark Zuckerberg is stepping up efforts to attract users and advertising dollars to Facebook’s services on smartphones and tablets, where promotions are placed among updates and photos from friends. The company, which has more than 1 billion members, has also worked to simplify the ad-buying process for marketers, with mobile making up 41 percent of ad revenue in the second quarter, up from 30 percent in the previous period.

“There’s growing recognition that, ‘Hey, this is not just a fad -- it’s not going away, it’s becoming ingrained in people’s lives,’” said Martin Pyykkonen, an analyst at Wedge Partners. “Their ads are becoming more effective. Advertisers are finding that’s a very attractive place to target.”

The new high marks another milestone for a stock that lost more than half of its value last year from the initial public offering price of $38, as investor concerns mounted over the company’s ability to make money as users shifted their activity to mobile devices.

Photographer: Tomohiro Ohsumi/Bloomberg

Chief Executive Officer Mark Zuckerberg is stepping up efforts to attract users and advertising dollars to Facebook’s services on smartphones and tablets, where promotions are placed among updates and photos from friends. Close

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Photographer: Tomohiro Ohsumi/Bloomberg

Chief Executive Officer Mark Zuckerberg is stepping up efforts to attract users and advertising dollars to Facebook’s services on smartphones and tablets, where promotions are placed among updates and photos from friends.

Mobile Focus

The company has spent more than a year rolling out advertising products that help to reach consumers on smartphones and tablets. In addition to promotions, Facebook also has stepped up efforts to help companies target the right groups of users with better data.

Facebook, which has a market capitalization of more than $100 billion, has surged more than 60 percent since announcing in July that sales of promotions on wireless devices are on track to surpass revenue from desktop computers. The Menlo Park, California-based company said sales rose 53 percent to $1.81 billion, topping analysts’ average prediction of $1.62 billion.

Mobile is a growing part of Facebook’s business base as members increasingly prefer to check their friends’ updates on their devices. Such wireless users expanded 51 percent to 819 million in the quarter, outpacing total growth of 21 percent.

‘Extremely Turbulent’

While the recent gains have been helpful, Zuckerberg described the first year as a public company as “extremely turbulent” at the TechCrunch Disrupt conference in San Francisco yesterday.

Nonetheless, the process has made Facebook “stronger,” said Zuckerberg, who made his comments after a question regarding the potential IPO of microblogging service Twitter Inc.

“I’m probably the person you would want to ask last how to make a smooth IPO,” he said. “I was really worried that people would leave the company and that people would get really demoralized when the stock was down.”

The CEO added that it’s not necessary to stay private as long as possible, something he believed prior to the IPO.

Separately, Zuckerberg criticized the U.S. government for its handling of questions around how the National Security Agency uses data from Internet companies. Facebook joined other companies, including Yahoo! Inc., earlier this month in asking the Foreign Intelligence Surveillance Court for permission to publish more details about the types of national security-related orders they receive from the government.

“I think it’s my job and our job to protect everyone who uses Facebook and all the information that they share with us; it’s our government’s job to protect all of us and protect our freedoms,” Zuckerberg said. “I think they did a bad job of balancing things here. I think that the government blew it.”

-- Editors: Reed Stevenson, Niamh Ring

To contact the reporter on this story: Brian Womack in San Francisco at bwomack1@bloomberg.net

To contact the editor responsible for this story: Pui-Wing Tam at ptam13@bloomberg.net

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