Facebook hit as profits slide

 

Stephen Foley
Monday 23 April 2012 21:06 EDT
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The prospects for Facebook getting a top-of-the-range valuation when it floats on the stock market took a knock last night when the company reported disappointing advertising revenues and a slide in profits for the early part of this year.

In an updated prospectus, filed to reflect trading since the company first announced plans to go public, the company said it made a profit of $205m (£125m) in the three months to the end of March, a 23 per cent slide from the same period last year.

That reflected, in part, Facebook's splurge on new engineering and sales staff, but it also reflected a slowdown in advertising growth. Revenues of $1.06bn were lower in the first three months of this year than in the fourth quarter of 2011, and a relatively disappointing 45 per cent increase over a year ago.

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