Facebook Stock Price Drops Below $20

Facebook’s stock price plunged to a new low on Thursday, dipping for the first time below $20 almost half the price it debuted at in May.

The latest figures put the company’s market cap at around $43 billion a far cry from the $100 billion-plus valuation that had been touted prior to the IPO. However, since the company went public, investors have increasingly fretted that the company is poised to lose revenues as users migrate to mobile platforms.

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New ‘Facebook Stories’ Reveals Human Drama Within

Facebook took the wraps off Facebook Stories Thursday, a section designed “to celebrate the different stories that are coming out of Facebook,” according to a spokesperson’s description.

The first issue of Facebook Stories, which resides at facebookstories.com, centers on “remembering.” A video at the top of the page tells the moving story of Mayank Sharma, who used Facebook’s “People You May Know” tool to contact old acquaintances and reconstruct his life history after being diagnosed with meningitis at age 27. A separate page serves up stories on memory from The New Yorker‘s archives, courtesy of the magazine’s librarians. Ari Shapiro, NPR’s White House correspondent, shares “one memory he’ll never forget,” and author and journalist Joshua Foer shares a list of books on memory that informed his own on the subject.

The remaining pieces, written by a mix of freelancers and Facebook employees whose job titles contain the word “editor,” tell of other interesting uses of the social network to save decaying landmarks and inspire art.

The point of it all? A Facebook spokesperson tells me that an “overwhelming outpouring of people” e-mail the company’s press account to share how they’ve used the site “to leverage connections, deliver social value to their communities and work through adversity in their own lives. We wanted to build a place where they can live and be showcased and celebrated, and also to give them some context.”

The social network launched a similar, less formal project as a Facebook application under the same name in 2010, which asked users to submit their stories to be shared with other users of the app. The application was deleted sometime in early 2011. The new Facebook stories is “a separate effort from a different team,” a spokesperson tells me.

The new Facebook Stories is almost identical in nature to Twitter Stories and Tumblr’s Storyboard, both of which detail how individuals are using those platforms through short articles, photographs and videos. Of the two, Tumblr’s is the more robust, with one or more new stories per day, whereas Twitter has published just two three-paragraph stories since mid-April.

Developer Claims Facebook Tried to Destroy His Business

The developer of a Facebook app has gone public with a post claiming that Facebook executives tried to hire him because the company was building a similar app.

While the idea of an “aqui-hire” might not sound bad to some, Dalton Caldwell, the CEO of App.net, charges that Facebook uses its heft to intimidate developers like himself rather than help build up the app community.
Reps from Facebook could not be reached for comment.

In a post entitled “Dear Mark Zuckerberg,” Dalton claims he visited Facebook’s Menlo Park, Calif., headquarters on June 13 and met with several execs at the company. “I was hoping the outcome of this meeting would be executive-level support for my impending product launch,” Caldwell wrote. Instead, Caldwell found that Facebook had a different motivation:

The meeting took an odd turn when the individuals in the room explained that the product I was building was competitive with your recently announced Facebook App Center product. Your executives explained to me that they would hate to have to compete with the “interesting product” I had built, and that since I am a “nice guy with a good reputation” that they wanted to acquire my company to help build App Center.I quickly became skeptical and explained that I was not interested in an acqui-hire. I said that if Facebook wanted to have a serious conversation about acquiring my team and product, I would entertain the idea. Otherwise, I had zero interest in seeing my product shut down and joining Facebook. I told your team I would rather reboot my company than go down that route.

Caldwell added that the platform developer relations exec at the meeting didn’t help defend his position. Rather, the exec told Caldwell that he was recently put in charge of App Center and because of new ad units the company was building he was now responsible for $1 billion in revenues. “The execs in the room made clear that the success of my product would be an impediment to your ad revenue financial goals, and thus even offering me the chance to be acquired was a noble and kind move on their part,” Caldwell wrote.
Finding no sympathetic ears in the company, Caldwell penned the missive directed at Zuckerberg.

Mark, I don’t believe that the humans working at Facebook or Twitter want to do the wrong thing. The problem is, employees at Facebook and Twitter are watching your stock price fall, and that is causing them to freak out. Your company, and Twitter, has demonstrably proven that you are willing to screw with users and 3rd-party developer ecosystems, all in the name of ad-revenue. Once you start down the slippery-slope of messing with developers and users, I don’t have any confidence you will stop.

Caldwell never explains what his app is. In a string of comments on Hacker News, some criticized the developer for complaining about what appeared to be a good deal from Facebook. Others, however, pointed out that Facebook’s position appeared to be “join us or die.” Beyond taking sides in the spat, though, one pointed out that Caldwell’s argument is itself a negotiation tactic: “It’s a game, FB used hard tactics, now he is using public sentiment. It is just an money game in the end. Blog posts like this just hurt both companies perceptions.”

Flock Is the App for Super Social Photo Sharers

We all know the process: take picture, upload picture to Facebook, create album, tag friends. It’s a tedious process, but someone’s gotta do it. Not for long for Flock users though. The new app makes photo sharing hassle free and pretty smart.

Using iOS’s photo detection API, the app cross references your geographic area with Facebook friends and determines who was present in the photo you just took. The app then creates an album, uploads all your pics, and when you and your friends leave the area, it notifies everyone in the album that the photos are available to view.

Everyone can then comment, download or email photos straight from the app, or push them to Facebook.

To work appropriately, Flock will require location services be enabled within the camera.

The founders of Bump, the app that lets two users knock phones together to exchange data, created Flock. Bump has been downloaded at least 100 million times, according to the company so the bar is set high for Flock’s potential.

The app is available for free in the app store.

Facebook: Better for the Planet than Google

Facebook revealed its 2011 carbon footprint on Wednesday that is, the amount of planet-warming carbon dioxide its offices and data centers’ energy usage is responsible for.

The figure was good enough to earn the social network kudos from Greenpeace and allowed it to look down its nose at less environmentally-friendly tech rivals, such as Google.

Facebook’s total energy usage last year measured 532 million Kilowatt hours; minus the 36% of its energy the company gets from renewable and nuclear sources, that led to 285,000 metric tons of CO2 emissions.

Compare that with the most recent annual total for Google: 1.5 million tons of CO2 in 2010. The relative difference in size between the companies doesn’t account for that; Facebook has designed its own servers to be as energy efficient as possible.

Does that mean hanging out with friends on the social network is a greener activity than searching? Facebook would certainly like you to think so. In a blog post announcing its carbon footprint report Wednesday, the company broke out the annual carbon dioxide emissions per monthly active user: 269 grams.

“To put this into context,” says the report, “one person’s Facebook use for all of 2011 had roughly the same carbon footprint as one medium latte. Or three large bananas. Or a couple of glasses of wine.”269 grams doesn’t sound like a big deal, until you consider that Facebook has 955 million active users. That’s a whole lot of lattes.

Still, environmental leaders were pleased. “Today’s detailed disclosure and announcement of a clean energy target shows that the company means business and wants the world to follow its progress,” said Greenpeace International Senior IT Analyst Gary Cook in a statement.

Not that there isn’t a lot of work to do, as Facebook admits in its report. The company would like to get up to 25% renewable energy in the short term, but admits that its carbon emissions are likely to “get worse before they get better” since the company is growing so fast.

83 Million Facebook Accounts Are Fake

The number of fake accounts on Facebook is roughly the size of Egypt’s population and larger than most of the world’s countries, the company disclosed this week.

In a 10-Q filing, Facebook acknowledged that a total of 8.7% or 83 million accounts on the network are bogus. Of that 8.7%, 4.8% are duplicate accounts, 2.4% are user-misclassified accounts and 1.5% are “undesirable” accounts, a.k.a. spam.

The figure is a bit higher than the company’s previous estimates. In a March filing, Facebook claimed about 5% to 6% of its accounts or 40.3 million to 50.7 million were fake. The company also says it bans at least 20,000 accounts daily and estimates about 600,000 accounts per day are compromised.

Taking the latest figures into account, Facebook’s latest claim of 955 million active users would be downgraded to 872 million.

Entrepreneur Claims He Made $8,000 in One Day Via Facebook Ads

In a nice counter argument to startup Limited Run’s claim that 80% of the clicks on its ads were bots, an entrepreneur has stepped up to provide a real-life example in which he made $8,000 in one day via Facebook ads.

The entrepreneur, Brendan Irvine-Broque, is the director of growth for PageLever. In a post on his personal blog that made Hacker News, Irvine-Broque claims he made $10,000 on Saturday, May 12, after holding an event in his backyard in which he sold 6,000 vinyl records for $3 each.

Irvine-Broque had previously run a business selling vintage vinyl records and he was eager to get rid of them. He says he spent about $2,000 for the bulk of those records. Marketing costs were cheap: He created a Facebook Event, shared it on the platform and bought about $150 worth of Facebook ads to promote the event.

In response, Irvine-Broque got 341 people who claimed they were attending and 104 maybes. The upshot:

At the end of the day, hundreds of happy customers later, I counted $10,000 in cash (and some payments accepted via Square – yes, I’m reporting the income, IRS). Over 3000 records sold in one afternoon. The majority of my customers came from Facebook Ads, so what is the calculated ROI, 2000%? 3000%? You do the math.

Irvine-Broque writes that the argument over bots is immaterial.

“As far as I’m concerned, clicks coming from Facebook are the realest click in the game right now.”
Meanwhile, Irvine-Broque says he wanted to share his experience to further a dialogue about Facebook ads. “It’s important for people to get out there and be talking about it,” he says.

Too often, he adds, businesses that are successful on Facebook don’t want to talk about it for fear that competitors will steal their ideas. That said, Irvine-Broque isn’t completely objective in the matter: PageLever’s business is based on Facebook analytics.

“I work for a business that’s very much heavily invested in Facebook,” he says. “It’s a fair critique to say I’m a little big biased, but I’m sharing things that I can back up.”

Facebook Testing ‘Save for Later’ Feature

Facebook is testing a new feature for desktop and mobile, Save for Later, which will let you add stories to a Saved folder. Saving stories will provide a similar experience to adding a tweet to your Favorites on Twitter.

The folder lives under Apps in Facebook’s iOS and desktop versions. To save a story, hold your finger down on the feature and a pop-up saying “Save” will appear. On Facebook desktop, the Save option will be under stories next to Share, Comment and Like.

According to iMore, your friends won’t receive a notification when you save their stories, distinguishing the new Facebook feature from Twitter’s Favorites.

As we’ve learned from other recent features Facebook has tested, such as “Find Friends Nearby,” rolling a feature out for a few members is by no means a guarantee of universal adoption. Facebook pulled that feature just one day after it began testing.

As of Tuesday, the feature is available to just a few iPhone, iPad and desktop users. Has the feature appeared for you yet? iMore says you won’t need to update your apps for Save for Later to appear

Startup Finds Fame After Tangling With Facebook

A Long Island-based startup has very publicly picked a fight with Facebook, penning a bitter goodbye note on the site that charges 80% of the clicks it paid for in ads were from bots.

Though the company Limited Run had only 400 or so fans when the note went up on Monday, the spat became national news. Tom Mango, co-founder of the company, which hosts stores for labels, designers and artists, said the entry got picked up by Hacker News, which led to press reports elsewhere. The notoriety by the incident may be the small business equivalent to General Motors’s decision to pull its ads from Facebook in May. The allegation is especially damaging since it comes after a BBC probe also found Facebook was teeming with fake spam accounts.

In the post, Limited Run announced the reasoning behind its decision to delete its Facebook Page in “the next couple of weeks.” The company reasoned that it was getting charged for clicks that were not coming from actual users. “Facebook was charging us for clicks, yet we could only verify about 20% of them actually showing up on our site,” the post reads. The company then tried other analytics software and found it couldn’t verify more than 15%-20% of clicks. So, Limited Run made its own software.

“Here’s what we found: on about 80% of the clicks Facebook was charging us for, JavaScript wasn’t on. And if the person clicking the ad doesn’t have JavaScript, it’s very difficult for an analytics service to verify the click. What’s important here is that in all of our years of experience, only about 1-2% of people coming to us have JavaScript disabled, not 80% like these clicks coming from Facebook. So we did what any good developers would do. We built a page logger. Any time a page was loaded, we’d keep track of it. You know what we found? The 80% of clicks we were paying for were from bots. That’s correct. Bots were loading pages and driving up our advertising costs.”

After that, the company contacted Facebook, but didn’t hear back. Meanwhile, the company wanted to change its name from “Limited Pressing” to the current Limited Run. A Facebook rep, however, told them that the company would do so only if Limited Run agreed to pay $2,000 or more in advertising per month, leading Limited Run to write, “This is why we need to delete this page and move away from Facebook. They’re scumbags and we just don’t have the patience for scumbags.”

A Facebook rep says that the company is investigating the matter. As for the name change: “There seems to be some sort of miscommunication. We do not charge Pages to have their names changed. Our team is reaching out about this now.” Mango says that a Facebook rep got back to the company after the matter became public and offered to change the name to Limited Run. Mango said thanks but no thanks.

Ironically, Limited Run got more marketing from picking a fight with Facebook than it would have by buying ads. However, Mango says there was nothing calculated about his actions. For instance, if he knew the matter would be reported so widely, he probably wouldn’t have called Facebook “scumbags.” Mango is similarly philosophic about Limited Run’s newfound fame. “I haven’t Googled us, but I’m sure what comes up now is this Facebook thing,” he says, adding that the company still plans to delete its Facebook Page. “We don’t want this to drag on. We want to move on from this. We don’t want them to be linking to this forever.”

Facebook Upgrades Photo Viewing, Sharing

Continuing the super-sizing of photos that began with the introduction of Timeline last year, Facebook on Monday enhanced image-viewing on the platform.

Now, when you click Photos at the top of your Timeline, you’ll be presented with larger pics that fill up the page. Presenting a page full of images will in theory make it easier to share photos. As Facebook’s blog stated on Monday, “With your Facebook photos all in one section, it’s simple to show friends your favorites. Click the star button to make important photos stand out.”

It’s no mystery why Facebook is putting so much emphasis on photos: Pinterest’s popularity has demonstrated a user preference for a more visual experience. Other sites like Quora and Chill.com have mimicked Pinterest’s design. Another major reason is the migration of users to mobile. Since photo-sharing is among the most popular activities on mobile, Facebook spent $1 billion to purchase Instagram and has rolled out its own Instagram competitor, Facebook Camera.

A Facebook rep, however, says the change only affects the Facebook desktop experience; mobile apps won’t be upgraded.

Facebook’s Not the Only One Struggling With Mobile Advertising

Considering all the attention it gets, mobile advertising is still a pipsqueak in the industry, accounting for just $1.6 billion globally in 2011.

Compare that to the overall $498 billion global ad market and you might wonder what all the fuss is about. Even newspaper revenues, which hit their lowest mark in 60 years in 2011 were 129 times higher than those for mobile. True, mobile advertising is a fast-growing category that 2011 figure is triple what it was in 2009 but even if the category nearly doubles, as it’s projected to do by 2014, we’re still talking about a $3 billion market.

At the moment, though, the mobile advertising segment is known for its destructive power it’s a vampire, sucking the net worth out of Facebook and, to a lesser extent, Google. Investors, who calculate the value of a company based on how they think it will do down the road, see a future in which users are accessing Google and Facebook products and services more via mobile devices. In that scenario, falling ad revenues are inevitable.

Of the two, Google is doing the best; CEO Larry Page claimed a $2.5 billion run rate for mobile ads last October, which appears to give the company more than 100% of the global market. However, even that’s not enough for investors, who fret that Google’s cost-per-click keeps falling as mobile ads become more prominent.

Facebook, meanwhile, has only offered mobile advertising for a little more than a month. During the company’s second-quarter earnings call with analysts, the company claimed it was making about $500,000 a day off its mobile ads, which would amount to $182.5 million over the course of a year. However, you’d assume that the figure would increase as adoption rises.

This did nothing to please investors, who pummeled Facebook’s stock price until it hit a new sub-$24 low on Thursday. Is Facebook really screwing things up that much?

Led by Mark Zuckerberg, Facebook appears to be giving mobile the single-minded focus that you would expect. The company has some of the best minds in the business attacking the problem and it’s solution so far Sponsored Stories on mobile isn’t bad. Multiple reports have found that the ads perform much better than standard desktop ads. David Williams, CEO of Blinq Media, says he’s seeing click-through-rates as high as 8.5% on mobile Sponsored Stories ads “which is pretty much unheard of.” The only problem with the ads, in Williams’s view is scale: The ads depend on an interaction with the brand by someone in your network. If none of your Facebook friends has interacted with a brand, then you won’t see the ad.

Of course, novelty might account for much of the ads’ efficacy. “New ad units always perform better,” says Nate Elliott, a Forrester Research analyst. “That will decline over time.”

But even if the ads are the silver bullet that Facebook hopes, the company has to grapple with a situation that’s affecting everyone in digital media: The transition to mobile, which, so far, is much less lucrative. How much less? Michael Wolff of The Guardian estimates that media companies that used to make $4 on advertising on a webpage only make $0.25 on the equivalent mobile page.

Shrinking screen size is a major reason: You simply can’t cram as many ads on a 3.5-inch iPhone screen as you can on a the 15-4-inch MacBook Pro screen. That means saying goodbye to Facebook’s unloved, but lucrative Marketplace ads (the direct-response ones that run in the right column.)

Some investors believe that Facebook can only solve the problem by making its own mobile devices as Google does now to better control the experience. However, Facebook put the kibosh on such speculation on Thursday.

But, as we’ve seen, even Google’s not immune to the trend. In its most-recent quarter, the search giant disclosed that the price advertisers pay for clicks on Google ads fell 16% year over year. Yet Google is less threatened by mobile since it has a lock on search advertising. Facebook doesn’t have the equivalent.

Day in the Life of a Future Facebook Phone

A gentle trilling on the bedside table rouses me from slumber; I fumble for the familiar blue-edged smartphone, and click its single button adorned with a thumbs-up logo to quell the alarm.

The phone snaps to life; as per usual, it drops in a few notifications then takes me straight to my Smart Feed. I remember not so long ago, when my phone’s default screen was a tray full of apps. Why, I wonder, did I ever want that terrifying level of choice? Just remind me about my appointments and to-dos, take me straight to the feed and be done with it. I can always swipe to the side to access my Facebook apps should I need them.

I spend a happy few minutes idly flicking through the feed. There aren’t too many sponsored stories at the moment; it’s mostly Instagram shots and the occasional news headline. The Facebook OS has learned my habits; it knows that’s about all I can cope with first thing in the morning.

As I fix the coffee and potter about the kitchen, one new sponsored story does get my attention it’s a local flower store, reminding me about my wife’s birthday tomorrow. (Evidently it waited until our phones were sufficiently far apart to pop up.) The store has grabbed a picture of her smiling, next to a bouquet it thinks appropriate based on past purchases.

Well, I don’t want to put that little effort into it. So I tap a button to turn the ad into a reminder; later in the morning, I’ll click on it again to call the shop, customize the bouquet, and send them a virtual card I’ve scrawled out on the screen.

On the train into work, I make a few quick moves in a couple of Zynga games didn’t their fortunes turn around when the Facebook phone launched then plug in my headphones. Instantly, the Smart Feed transforms into a selection of Spotify songs and viral videos. I tap through the latter so I can get a jump on conversations at the watercooler.

At my desk, the feed transforms into news stories (with a special preference for ones it knows my colleagues have clicked on). There’s nothing major; a couple more pieces speculating on iOS 7, and how much it can compete with the Facebook OS. Rumor has it that Apple is working with Twitter, its new best friend, to put a different kind of news feed front and center.

Makes a lot of sense, as the comments point out; the company is going to have to do something radical to restore the luster of the iPhone, especially after Facebook started swiping Apple’s best mobile engineers last year. Besides, the Facebook phone is heavily subsidized by advertisers; it’s hard to compete with almost free.

I make a few free calls throughout the morning, using the phone’s Skype integration. It’s as simple as holding the thumbs-up button and saying my contact’s name. Most of my friends have a similar device; those that don’t, I can still reach via their desktop. Everyone keeps a Facebook tab open these days in case they miss a call.

Lunchtime, and my screen fills up with coupons from local merchants. I dismiss them all with a tap, head to my favorite sandwich place, point the phone at a QR code reader. Hey presto: my tenth sandwich is free. The Facebook OS was rolled out with a massive small business partner program; Zuckerberg always said that was where the big money was.

I spend much of the afternoon responding to Facebook messages, which is slowly replacing email across the company. But old habits die hard, so I have to swipe up to the Gmail app, too. Google was smart to get on the platform early, and Facebook was smart to build its entire OS on a modified and fully licensed Android kernel. That helped keep the peace between the two tech giants.

On the train home, an “on this day in history” news item catches my eye. Turns out it’s exactly a year since Facebook’s first faltering earnings call the one in which Zuckerberg famously denied the company was “building” its own phone. Well, of course it wasn’t building the phone itself, I smile to myself, turning the handset over and glancing at its HTC logo.

What we should have listened to was another quote from the call: “having a device wherever you are creates more opportunities for sharing and connecting.” That was the understatement of the year.

Zuckerberg Denies the Facebook Phone. What’s the Evidence?

Facebook CEO Mark Zuckerberg said Thursday in the company’s first-ever earnings call that “it wouldn’t really make much sense” for the social networking monolith to build its own smartphone.

A “Facebook phone” has been rumored for sometime, however and many analysts regard its appearance as a matter of when, not if.

So what’s the evidence that a mobile device based entirely around the social network is on its way?

Back in November of last year, the scuttlebutt originally reported by All Things D was that Facebook and HTC were working together to develop a phone codenamed “Buffy” that would hit store shelves in 12 to 18 months as soon as this coming fall.

Buffy was said to run on a modified version of Android, tweaked heavily to revolve more prominently around Facebook and HTML5 support.

Then The New York Times reported this May that Facebook had hired “more than a half dozen” former Apple engineers who had previously worked on the iPhone or iPad to help build hardware for a Facebook phone. Finally, a Bloomberg report earlier this month reiterated much of what ATD reported in November, but pegged the mysterious “Facebook phone” launch to mid-2013.

While Zuckerberg denied the logic of Facebook building a phone, there are plenty of reasons why doing so would, in fact, make a lot of sense.

Facebook has been widely criticized for struggling to adapt to an increasingly mobile web, which most analysts see as dominating the emerging wave of digital life. One hedge fund manager recently predicted that Facebook’s mobile sluggishness would lead to the company virtually disappearing by the year 2020.

A Facebook-centric operating system on a Facebook-branded smartphone could go a long way toward capturing more mobile users and ad dollars.

‘Advanced Pimpin’ on Facebook Derails Woman’s Legal Case

The lesson here, as always: Be careful what you put on Facebook.

A San Francisco woman’s legal claim was derailed by Facebook bio information in which she proclaimed her prowess as a “pimptress,” according to a San Francisco Public Defender’s Office press release.

The woman’s profile apparently indicated that she double-majored in “Advanced Pimpin,” and “keepin hoes in LINE!!!” Her profile also said she worked as a self-employed “head pimptress in charge.”

The unnamed woman had accused 23-year-old Anthony Dorton of beating her up in a parking lot in the city’s startup-heavy SOMA neighborhood. But a jury acquitted Dorton of felony assault and other charges after a public defender used the accuser’s Facebook posts to establish a pattern of lying.

The woman said Dorton had forced her into prostitution. She testified under oath that she was not a pimp and had never worked as a prostitute before coming to the Bay Area. She said Dorton assaulted her pulling her hair, throwing her to ground and punching her in the head after she had a meeting with a john that went badly.

But her Facebook braggadocio contradicted many of those claims. Dorton’s public defender said the woman used the social network to regularly post updates and comments about managing and regulating prostitues as well as list her alleged work and education credentials.

Deputy Public Defender Qiana Washington also reportedly showed jurors ads from prostitution websites including one touting a 17-year-old girl that included the woman’s photo and phone number as contact information. On the stand, the woman admitted to photographing the teen and fielding calls, but denied pimping her.

Those discrepancies and other evidence made the woman’s assault claim against Dorton untrustworthy in the eyes of jurors, according to Washington.

“The complaining witness was caught in lie after lie,” she said. “This was a case that depended on her word, and she demonstrated it could not be trusted.”

Facebook: Sponsored Stories Make $1 Million a Day

Facebook CEO Mark Zuckerberg, COO Sheryl Sandberg and CFO David Ebersman hosted their first earnings call early Thursday evening.

The three executives spoke primarily about the company’s advertising products, which accounted for 86% of its revenue in the second quarter. Zuckerberg emphasized the need to make ads more social most ads on Facebook right now are not. He noted that Sponsored Stories, Facebook’s primary “social” ad product, is now generating $1 million in revenue per day, about half of which comes from mobile.

Sandberg added that Sponsored Stories on desktop and mobile were performing much better in terms of engagement than ads displayed on the right rail of the News Feed.

Promising, but remember that Facebook delivers far fewer ads on mobile than through the desktop. Ad impressions still grew more slowly than users over the quarter, as more users shifted access to mobile, Ebersman said. Five hundred and forty-three million of Facebook’s nearly 1 billion users access Facebook via mobile, up 67% from a year ago. Those users are 20% more likely to log on to Facebook on a given day, Zuckerberg said.

During a Q&A with analysts, Zuckerberg rejected the notion of a Facebook phone. “Building out a whole phone wouldn’t really make much sense for us,” he said.

When asked about the company’s plans for Instagram, Zuckerberg noted that “the acquisition isn’t yet complete, “so there’s been no integration… There will be an update when that happens.” He said that most of Facebook’s acquisitions have been for talent, but Instagram was an exception i.e., Facebook intends to make use of the product itself.

Beyond mobile, Sandberg noted the importance of the small business market: “More than 40% of local business have no web presence at all,” she noted, adding that most local business owners were not “tech savvy.” “Facebook has a huge advantage because those local business owners are using Facebook as users. The product that we want them to use, Pages, is a lot like their own user profile. The leap is smaller.”

Facebook Has 955 Million Active Users Still Shy of a Billion

The social network has been inching ever closer to the major milestone of a billion monthly active users (that is, folks who log into Facebook at least once a month). In April, as part of an amendment to its IPO filing with the SEC, the company announced it had 901 million monthly active users.

Some observers and more than a few Facebook employees had hoped this number would hit the magic billion by the time its second quarter results came out (ie. today). Others, such as Gregory Lyons, a senior analyst at iCrossing, predicted the billion mark would be reached in August. Now it’s looking more like those champagne corks will pop in September, or even October.

Nine hundred and fifty-five million users, of course, is still a superlative achievement. Facebook can also boast that 552 million of them log in every day up from 526 million in April. The 955 million number also represents 29% growth in users year on year.

When Facebook first filed its IPO paperwork with the SEC in February, the network had 845 million users. It hit the 500 million mark back in mid 2010, hence the tag line for that year’s award-winning movie The Social Network: “you don’t get to 500 million friends without making a few enemies.” The number was out of date by the time those posters hit billboards.

But of course, even 955 million users isn’t cool. You know what’s cool? A billion users. (Expect to see that joke roll out with increasing frequency over the next few months.)

Facebook Stock Hits New Low

Facebook beat the Street’s estimates for its second quarter, but investors were apparently looking for more.

In after-hours trading, Facebook’s stock dipped below $24, a new low for the stock, which had made its debut in mid-May at a price of $38. Trading in afterhours fell more than 10% after a day in which the stock had already fallen 8.5%.

The battering comes a day after Zynga’s stock fell 40% in afterhours on Wednesday when the company posted a net income loss of $22.8 million. 

Facebook Launches Recommendation Bar to Spread News Across Site

Facebook launched a recommendation bar on Thursday that allows users to discover new articles based on what others in your network are reading and sharing.

When a Facebook user likes an article via the new recommendation bar, the story is published to their Timeline similar to what happens when you use the Like button and it shows up in friends’ news feeds.

“The recommendation bar is another option for websites particularly blogs and media sites to be more social and active, keep people on the site longer, distribute content across Facebook and benefit from referral traffic,”

Here’s what it looks like: While a Facebook member reads an article on the site, a small pop-up window displays at the bottom of the screen, which highlights recommended articles and prompts them to like the page, according to a blog post from Facebook developer Jeffrey Spehar on the company’s developer page.

“Recommendations are based on content that friends have explicitly liked and shared in your app or website,” Spehar wrote.

“In early tests, sites are 3x times the click through on the stories it recommends than through the Recommendations Box,” Spehar said.

To install the social plugin, users will need to copy a few lines of the Facebook code and paste it onto their site. For more details on how to set it up, you can check out Facebook’s step-by-step instructions on its developer page.

Facebook Posts $1.18 Billion in Revenues, Beating Low Estimates

Facebook allayed some of the fears about its business on Thursday by beating Wall Street’s estimates for its fiscal second quarter revenues and earnings.

Facebook posted revenues of $1.18 billion and non-GAAP earnings per share of $0.12. Analysts polled by Thomson Reuters predict Facebook to report non-GAAP earnings $0.12 per share on revenues of $1.1 billion, which will be up about 5% from last quarter‘s $1.058 billion.

Advertising makes up the bulk of that; last quarter $872 million came from ads. Analysts were expected ad revenues of $921 million. Facebook beat that with $992 million in ad revenues.

The company also announced 552 million daily active users as of June 30, a 32% jump over the year-ago period. Monthly active users were 955 million, which was up 29%. The company also claims 543 million monthly active users on mobile, a 67% jump.

Facebook’s shares were down 8.5% before the market closed, to $26.84. In after-hours, the stock was down another 5% to less than $26.

Facebook’s First Earnings Call: What to Expect

Facebook‘s first earnings call as a public company has been hyped in the business press like a summer blockbuster. It’s a shot at redemption, maybe the feel-good call of the summer. Or perhaps it will be another bummer, like the company’s May IPO.

Either way, there’s more drama around the call than usual, which makes it interesting even for those who don’t usually follow business calls. So if you’re a Facebook investor, a social media enthusiast or just someone who has time on their hands this Thursday afternoon, here are some things to watch for as you grab your popcorn:

It’s the Ads, Stupid

Facebook makes most of its money through advertising. Yet the company went public during an awkward time in which it was overhauling its ad formats. Back in February, Facebook introduced a slew of new ad products that were designed to get marketers to think differently about the platform. Instead of buying the usual display ads, Facebook pushed the idea of amplifying successful status updates to reach more potential customers.

Though some advertisers claimed success with the format, there’s far from a consensus. In fact, eMarketer released a report in June arguing that Facebook’s Marketplace ads you know, the cheesy direct-response banners for weight-loss products and such are actually where the growth is at. The report quotes another report from Capstone Investments that concluded, “In many cases large [consumer packaged goods] advertisers are seeing comparable ROI on self-serve ads [to those] they were achieving on premium ads and are allocating spend that otherwise would go to premium ads to self-serve ads.” eMarketer also believes that many advertisers held off on full-year 2012 buys because they wanted to see how Facebook’s Premium ad products would evolve. That might explain a drop in revenues for Facebook’s first quarter.

Overall, analysts polled by Thomson Reuters predict Facebook to report earnings of $302.8 million on revenues of $1.1 billion, which will be up about 5% from last quarter‘s $1.058 billion. Advertising makes up the bulk of that; last quarter $872 million came from ads.

Actually, It’s the Mobile Ads

A bigger concern for analysts perhaps is whether Facebook is successfully transitioning to mobile. The social network’s users are already migrating there. The question is whether Facebook can monetize the new format. In June, Facebook began letting advertisers run Sponsored Stories for the News Feed for mobile devices.

While the format is pretty new, early studies are showing an encouraging increase in click-through rates. However, if analysts put a lot of stock in those studies, Facebook’s stock price would not be in sub-$30 territory. Analysts are looking for a solid growth figure for mobile.

Subscriber Growth: You Know What Would Be Really Cool? A Billion

Facebook is set to announce a total of 1 billion users any day now. In fact, it could be today. The company has already claimed 901 million users in April, so the fact that it added 99 million users in three months isn’t that huge. However, the billion figure crosses a psychological barrier and would doubtlessly be a big deal in the press. Whether Facebook is actually at 1 billion remains to be seen.

The 1 billion aside, Facebook needs to counter reports that its growth is slowing. In particular, comScore found in April that U.S.-based unique visitors rose just 5% year-over-year to 158 million. Facebook users also spent more than six hours a month on the site, up 16%, but that compares to a 23% increase in 2011. While most would be happy with such growth, Facebook has positioned itself to Wall Street as a growth story, not a relatively mature industry player.

The Zynga Factor

Zynga on Wednesday reported a net income loss of $22.8 million for its most-recent quarter and revised its outlook for the rest of the year downward. The announcements prompted a 40% drop in the company’s stock in after hours trading, but also depressed Facebook’s stock by 6%.

Though Zynga blamed Facebook for the loss  “Our users did not remain as engaged and did not come back as often,” said John Schappert, Zynga’s chief operating officer. “Instead new games were promoted.” the two companies are still closely linked. In February, Facebook announced that Zynga provides 12% of its revenues. The two companies may be trying to do the business equivalent of seeing other people, but their fortunes are still so closely linked that if Zynga catches a cold, Facebook sneezes.