Facebook Inc’s valuation topped Amazon.com Inc, leaving the -social-networking company behind only Google Inc among US Internet companies.
Facebook is valued at US$82.9 billion on secondary exchange SharesPost Inc and has jumped by more than 40 percent since the middle of last month. Amazon shares dropped 7.2 percent on Friday after a disappointing sales forecast, pushing its stock market value down to US$77.2 billion.
Investor demand for Facebook is soaring on the private markets as advertisers pay for the attention of a user base that’s ballooned to more than 500 million.
Ad spending on Facebook will more than double to US$4.05 billion this year, according to researcher EMarketer Inc. LinkedIn Corp, the biggest networking site for professionals, said on Thursday that it planned to raise US$175 million in an initial share sale.
The gains reflect the rising popularity of social media companies, which let users interact and carry out other tasks that were long unavailable, or only possible to a limited degree, on older Internet sites.
Facebook’s estimated worth surpassed that of EBay Inc, owner of the largest e--commerce market, late last year.
It is still dwarfed by Google, the world’s biggest Internet search engine, which is worth US$192 billion.
SharesPost, a marketplace for private company shares, bases value on such criteria as transactions, research estimates and venture-funding rounds. Facebook shares have sold for as much as US$60 apiece on SharesPost this month, meaning some investors value the social-networking company at US$136 billion.
At US$82.9 billion, Facebook’s value has jumped more than sevenfold since March, when SharesPost introduced its Venture-Backed Index, featuring seven companies. Facebook is more than US$77 billion more valuable than the second-biggest member, Zynga Game Network Inc, valued at US$5.7 billion.
While Facebook’s value is surging on the secondary markets, a poll of global investors showed investor skepticism. Sixty-nine percent of investors in a survey of 1,000 Bloomberg customers, who are investors, traders or analysts, said Facebook is overvalued after the US$50 billion valuation implied by Goldman Sachs’s investment.
Amazon, the biggest online retailer, went public almost 14 years ago. The Seattle-based company said on Thursday that sales in the first quarter would be as low as US$9.1 billion, trailing the average analyst estimate of US$9.36 billion in a Bloomberg survey.
Still, Amazon is 17 times the size of Facebook in terms of revenue. With US$34.2 billion in sales last year, Amazon trades for 2.2 times revenue. Facebook, said to have revenue last year of US$2 billion, has a price-to-sales ratio of 41.5.
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