The Chief Executive Officer of Facebook Inc., Mark Zuckerberg, said that the company is to continue to make large investments in new technologies in the upcoming years. The announcement was greeted with caution by some analysts.
Mr. Zuckerberg said on a call, cited by Bloomberg: “For the next 10 years, our focus is on driving the fundamental changes in the world that we need to achieve our mission, connecting the whole world.” As reported by the Financial Times, the companys CEO also said that his theory of investment includes “to first focus on connecting 1bn people, reaching the full potential before aggressively turning them into new businesses”. Mr. Zuckerberg also added: “I can’t think of that many other companies or products that have multiple lines of products that are on track to connect 1bn people.”
The founder and CEO of the company also said that Facebook expects its newly-purchased products, such as WhatsApp, Instagram and the Messenger to reach 1 billion subscribers each before starting to generate any revenue.
Mr. Zuckerbergs announcement comes after the company posted a projection for its fourth-quarter sales, which was lower than the initial analysts forecasts. Facebook explained that its costs would increase within the range of 50% to 70% in 2015 because the company hires more employees and is focused on investments in new products. This projection, on the other hand, was considerably higher than what was anticipated by analysts, who said the revenue growth of Facebook is expected to be about 35%.
In the third quarter Facebook reported a 59% revenue increase to $3.2 billion. The company stated its expenses increased by 41% due to the fact the largest social network in the world hired about 1 200 new employees and bet on acquisitions.
Now the company looks further into the future, with its Chief Executive Officer vowing to follow an aggressive investment strategy.
Facebook Inc. was 0.61% up to close at $80.77 per share yesterday in New York, marking a one-year increase of 60.80%. The company is valued at $208.73 billion. The companys shares traded at €58.74 in Frankfurt as of 8:40 GMT, down 6.51%. According to CNN Money, the 40 analysts offering 12-month price forecasts for Facebook Inc. have a median target of $90.00, with a high estimate of $106.00 and a low estimate of $72.00. The median estimate represents a +11.43% increase from the last price of $80.77.