It seems like just yesterday that Facebook Inc went public, now its market value has topped US$250 billion.
The social network company’s 2.4 percent climb to a record close on Monday made it the first company in the Standard & Poor’s (S&P) 500 Index to breach that market cap so quickly. The previous record holder was Google Inc, which took about eight years.
Facebook’s rapid ascent might indicate investor confidence that the company would continue to increase mobile-advertising sales on its application and others. To some degree, the gain also reflects froth in technology stocks; the NASDAQ Internet Index has almost doubled since Facebook went public.
Its shares trade at 87 times earnings, almost five times the average in the S&P 500. Companies in the NASDAQ Internet Index trade at a price-earnings ratio of 27.
“When you see stocks with these high multiples, it shows you the market’s comfort in the longer-term growth story,” said Paul Sweeney, an analyst at Bloomberg Intelligence. “Investors think Facebook is more valuable than the average NASDAQ stock.”
The company’s quick rise to US$90.10 a share on Monday is even more remarkable because the stock lost more than half its value in the four months after its initial public offering (IPO) in May 2012. Facebook had a market value of US$104.2 billion at its IPO, so the company did not have to climb as far as some other companies did to reach US$250 billion.
With a market value of US$253 billion, Facebook is now the ninth-biggest company in the S&P 500 — bigger than Wal-Mart Stores Inc and Procter & Gamble Co, which took decades to grow to be so valuable.
Facebook’s revenue from advertising — from which the company gets more than 90 percent of its sales — increased 46 percent to US$3.32 billion in the first quarter from a year earlier. More than two-thirds of that came from mobile ad sales. Analysts estimate that sales rose 37 percent in the second quarter.
Longer-term, the company plans to serve ads on other applications and Web sites, and to make money from its rapidly growing Instagram, WhatsApp and Messenger apps.
Facebook also is betting on its US$2 billion purchase last year of Oculus VR Inc, a virtual reality headset maker, and efforts to expand Internet connections in developing nations.
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”
TRANSFORMATION: Taiwan is now home to the largest Google hardware research and development center outside of the US, thanks to the nation’s economic policies President Tsai Ing-wen (蔡英文) yesterday attended an event marking the opening of Google’s second hardware research and development (R&D) office in Taiwan, which was held at New Taipei City’s Banciao District (板橋). This signals Taiwan’s transformation into the world’s largest Google hardware research and development center outside of the US, validating the nation’s economic policy in the past eight years, she said. The “five plus two” innovative industries policy, “six core strategic industries” initiative and infrastructure projects have grown the national industry and established resilient supply chains that withstood the COVID-19 pandemic, Tsai said. Taiwan has improved investment conditions of the domestic economy
Sales in the retail, and food and beverage sectors last month continued to rise, increasing 0.7 percent and 13.6 percent respectively from a year earlier, setting record highs for the month of March, the Ministry of Economic Affairs said yesterday. Sales in the wholesale sector also grew last month by 4.6 annually, mainly due to the business opportunities for emerging applications related to artificial intelligence (AI) and high-performance computing technologies, the ministry said in a report. The ministry forecast that retail, and food and beverage sales this month would retain their growth momentum as the former would benefit from Tomb Sweeping Day