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Facebook Admits It Doesn’t Know How Mobile Works

Facebook Admits It Doesn???t Know How Mobile Works
Photograph by Mark Lennihan/AP Photo

As Facebook moves inexorably toward its much-anticipated initial public offering, attention has been focused on all kinds of things about the giant network with the $100 billion potential market valuation—including the earth-shattering fact that Chief Executive Officer Mark Zuckerberg insists on wearing a hoodie during his meetings with Wall Street bankers and analysts. But what investors should be more focused on is the problem Facebook highlights in the most recent amendment to its S-1 securities filing: namely, that its mobile business is noticeably light on advertising revenue and that the company isn’t exactly sure how (or whether) it can fix that.

It’s worth noting that the latest amendment isn’t the first time Facebook has mentioned that mobile could be its kryptonite. My colleague Kevin Fitchard wrote about a similar warning earlier this year, in which Facebook said it expected the rate of growth in MAU (monthly average users) of its mobile products “will continue to exceed the growth rate of our overall MAUs for the foreseeable future” but added that the company didn’t “directly generate any meaningful revenue from the use of Facebook mobile products, and our ability to do so successfully is unproven.”