By Brandon Bailey, San Jose Mercury News –
SAN FRANCISCO — Facebook CEO Mark Zuckerberg told a friendly tech audience Tuesday that his company’s mobile business has been underestimated, but he vowed it will “make a lot more money” than the company’s traditional website.
Zuckerberg also reiterated that Facebook has no interest in building its own smartphone, but he said the company will probably enter the Internet search business at some point.
The 28-year-old CEO, who appeared onstage at the TechCrunch Disrupt conference, spoke rapidly, appearing determined to get across some key talking points during his first public appearance since the giant social network made its controversial stock market debut. He acknowledged the company made missteps in building its platform for smartphones and mobile devices, but said the company is moving quickly to catch up.
Zuckerberg chose to appear in the relatively friendly environment of a tech industry conference for startups and their funders, who have long viewed Facebook as the model for their own hoped-for business success. But he faced some tough questions from moderator Michael Arrington, who gained a reputation for voicing strong opinions as founder and former chief of the industry news blog TechCrunch, which organized the conference.
Facebook’s stock performance “has obviously been disappointing,” he conceded, adding quickly that “we care about our shareholders.” But he said he’s committed to a dual mission of building Facebook as a social networking service and building a business to support that service.
Zuckerberg started Facebook in his college dorm room and led it to an initial public offering of stock that valued the company at an eye-popping $100 billion in May. But shares in Facebook have tumbled since then, amid signs of slowing revenue growth and questions about whether Facebook can adapt to a world where more users access Internet services on smartphones and tablets rather than desktop PCs.
Facebook shares closed at $19.43 on Tuesday, after falling below $18 last week.
Zuckerberg has kept a low profile since the company’s IPO, although he spoke with analysts on a telephone conference call when the company issued its quarterly earnings report in August. Facebook executives have generally avoided commenting on the company’s stock performance; instead they’ve announced a series of new features and advertising programs, most of them aimed at mobile users.
Facebook reported $1 billion in profit last year on nearly $4 billion in revenue, mostly from advertising. But several financial analysts have recently trimmed their projections for Facebook’s revenue growth this year. Last week, the research firm eMarketer recently lowered its forecast for Facebook’s 2012 revenue to $5 billion, down from a $6 billion projection last spring.
That has rattled investors and helped drive down the stock price. Industry experts, in turn, say that could hurt Facebook’s ability to recruit and keep talented employees, whose compensation usually includes grants of company stock.
Zuckerberg, however, is still admired by at least some of the would-be entrepreneurs at the TechCrunch conference, many of whom are involved with startups that they hope will become the next Facebook.
“I don’t think anything has changed about him or the company,” said Nicolas Gautier, an early-stage financier from Brazil, where he said Facebook has had “huge growth” in the past year.
While some argue Facebook’s IPO was overpriced, he added, the company was a good investment for those who backed it in earlier years.
“They’ve steered a pretty good course,” Gautier said, “and I still trust they’ll be able to continue.”