Teens. Who needs ’em?
Facebook shares Thursday gained 2.4 percent after Wall Street pros dismissed fears that a third quarter decline in how often teens visited the site indicated a slowdown or other weakness.
“While we had been expecting to see a shift in teen usage based on the surveys … we believe that any shift in teen usage over the next 1-2 years is unlikely to impact” Facebook, Piper Jaffray analyst
Gene Munster said in an Oct. 31 research report.
“There are things that could be threatening to Facebook, but this just doesn’t seem to be it,” Brian Wieser, senior research analyst with Pivotal Research Group, said, alluding to the teen traffic dropoff.
Facebook execs spooked shareholders Wednesday by confessing to a slight drop in how often teens came to the site in the period, despite no change in their overall numbers.
Facebook shares gave back a 15 percent after-hours stock rise on the news.
Shareholders were also troubled by Facebook’s decision to not add to the number of paid ads in users’ news feed — which currently stand at about one ad for every 20 stories — for fear of turning users off.
Deutsche Bank analyst Ross Sandler, who said he expects mobile ad revenue for next year to grow by 75 percent, down from his earlier 80 percent forecast, said the ad load factor was significant.
“The ad-load debate feels like the next major overhang around the story,” he said.