Facebook founder Zuckerberg’s worth drops by $5 billion

(Associated Press via Facebook)

(Associated Press via Facebook)

(Updated at 6:23 p.m.)

At least the wedding went off without a hitch.

Since Facebook founder Mark Zuckerberg offered a piece of  his social networking company to the public and tied the knot with longtime girlfriend Priscilla Chan two weeks ago, his personal fortune and that of his company have taken sizable hits.

Facebook’s stock has plunged since the public began buying shares May 18, and the drop has shaved at least about $25 billion from the $104 billion valuation placed on the company. The stock was down again Wednesday.

The stock, which was priced at $38 for the initial public offering, is down nearly 26 percent since the IPO, extending its spirial Wednesday to close at $28.19, down 65 cents, or another 2.25 percent from Tuesday’s close. That means the value of Zuckerberg’s holdings is also down, by nearly $5 billion as of Tuesday and in just two weeks, according to Bloomberg’s daily ranking of the world’s richest people.

As a result, Bloomberg has knocked Zuckerberg off its list of top 40 billionaires worldwide. The 28-year-old is no longer in the company of Bill Gates, Warren Buffett and the Waltons of Walmart.

On May 18, Zuckerberg’s Facebook holdings were valued at $19.4 billion, instantly making him the 26th richest man on Earth. By Tuesday, the value of his shares had dropped to $14.7 billion. Of course, it’s only a loss on paper, and the loss is only realized If the shares are sold.

Some investors have been so disappointed in the loss of value after purchasing the stock that they are suing the company, the IPO’s underwriters and Nasdaq, which trades Facebook’s stock under the symbol FB, claiming Facebook wasn’t fully upfront about its growth prospects.

Facebook’s stock reached as high as $45 in the euphoria just after the IPO, but it hit a low of $27.86 Wednesday before trading ended for the day.  Bloomberg reports Facebook’s stock price would have to drop to around $23 to be in line with the valuations of other Internet companies. It’s currently trading at 29.5 times the company’s projected 2014 profit of $2.69 billion.

Zuckerberg was replaced on the Bloomberg Billionaires Index by Luis Carlos Sarmiento, Colombia’s richest man, worth $15.5 billion.

Zuckerberg was honeymooning with Chan in Europe this week.

36 comments Add your comment

Jim S.

May 30th, 2012
11:54 am

Poor Zuckerberg…you gotta feel for the guy.

iTiSi

May 30th, 2012
12:04 pm

I actually feel more sympathy for all those who bought stock. Then again, no I don’t, not really. They should have known better. Who didn’t see this coming a mile away?

Nicole

May 30th, 2012
12:10 pm

Agree with iTiSi…who was dumb enough to buy FB shares?!?!?

Pointsofvision

May 30th, 2012
12:15 pm

Poor Mark, what is he going to do with a pitiful 14.7 billion dollars now? He only have 70 more years to make it all back. Hope him and the new wifey can still afford a cup of coffee at Starbucks.

jarvis

May 30th, 2012
12:21 pm

I do feel for them iTiSi.

I never like to see people lose money. I’m not much of a successful investor myself, so I know what it’s like to watch your hard earned cash go out the door.

But to your point, even as bad as I am at investing, I didn’t see this one as a winner. I FB frequently, and I saw no way that the earnings valuation could have been accurate.

Advertising on the FB is like burning cash….I ‘ve been on it for at least an hour a week for 3 years and I can’t think of a single thing that has been advertised.

jake's mom

May 30th, 2012
12:28 pm

Hope he can still pay his VISA bill…they’re relentless!

NotYou

May 30th, 2012
12:32 pm

Agreed. As many have said, even if FB was upfront with everything, it wouldn’t have changed a thing. It was a bad investment based on what they DID reveal. Those investors should try reading next time.

aquarius

May 30th, 2012
12:59 pm

I heard on the new that he had dinner at a restaurant recently and did not leave a tip. Maybe this is payback for his callous disregard of regular people who work for tips trying to make a living. Not that it will really hurt him, but you gotta wonder…..

MARIA JOSE

May 30th, 2012
1:02 pm

Enter your comments here

Frank Furter

May 30th, 2012
1:04 pm

Man-O-Man! I’m glad I passed on the over rated offering.
http;//www.facebook.com/notquitedevils

still looking

May 30th, 2012
1:06 pm

I’m still looking to get rid of my WebVan stock. Any takers???

Everyman

May 30th, 2012
1:06 pm

And I am supposed to care about this, why?

Rell

May 30th, 2012
1:07 pm

Why would you buy stock into a company thats main business is running a social network?

Pat

May 30th, 2012
1:10 pm

Suing?!? Are they serious? Most people on facebook know that they will have a difficult time making “profits.” So I guess now, if I invest money and it does not go up, then I can sue too?

El Mongol

May 30th, 2012
1:11 pm

I don’t know man Facebook is full of teenage girls and there is not more stupid creature on the planet. So, I suspect he can get them to give him more money if they can be his “Friend”.

☺☻Have A Smile!

May 30th, 2012
1:14 pm

I would have thought he’d at least have met an attractive woman.

Plenty of GOOD LOOKING, nice single women in the world and he picked this one?

Oh well…I guess there’s no accounting for taste.

Poof Pow!

May 30th, 2012
1:24 pm

All I have to say is that Facebook does not produce anything…. If you were dumb enough to buy stock in a company with no production, shame on you. Your punishment will be to lose your investments. (#hand slap)

Mama Mia!

May 30th, 2012
1:28 pm

So dis iz why he no tippa our Italiano waiters!

Advertising Account Executive

May 30th, 2012
1:37 pm

Facebook’s revenue generator is suppose to be from advertising sales …….. but no way in heck would 104 billion even be a realistic goal. I smell a facebook a user fee for the future.

pj

May 30th, 2012
1:44 pm

This just shows how ephemeral that kind of “wealth” and the whole stock market thing is. ps ditto on the not tipping.

LOL

May 30th, 2012
2:09 pm

PoofPow is right – FB produces nothing – no commodity to sell/trade. Just like MySpace, as soon as the “”next” social media function is released, FB will he history. Tisk Tisk you poor souls who invested in this bogus mess.

Sluggo

May 30th, 2012
2:10 pm

@ AA Executive

Will people pay a fee for the service?

Eileen

May 30th, 2012
2:15 pm

Someone mentioned a user fee. If this happens stock will go up some, but facebook would lose a lot of users. Including me!

woodrow

May 30th, 2012
2:22 pm

Facebook is a worthless stock. The only people that bought it are speculators. They have no solid business model. They are as vulnerable as MySpace was. This kid is a billionaire on paper only. Don’t spend the money kid.

Mr. KnowitAll

May 30th, 2012
2:22 pm

It will be interesting to see of the “new” old lady sticks around since he’s not worth that much money, any more. I predict a short marriage, quick divorce, and she walks away with Billion$.

Common Sense

May 30th, 2012
2:23 pm

Facebook = Myspace

Just another in a long line of internet fads.

A fool and his money are soon parted.

’nuff said

gfan

May 30th, 2012
2:42 pm

A billion dollars isn’t cool. You know what’s cool? A MILLION dollars.

TossSweep

May 30th, 2012
2:43 pm

To be knocked off the 40 Billionaires list is just a disgrace. $19.4 to $14.7 billion is just shameful. I wouldn’t even tell my friends I’m no longer worth $19.4 billion.

LongGone

May 30th, 2012
3:07 pm

5 Billion already…he better buy new socks now! Tell you what, buying stock in a company that doesn’t sell anything–okay, they advertise–is dumb! Microsoft, sells–IBM, sells–big stock market money makers all sell…

Oh, if you spent you savings in stocks here—better SELL and buy socks too… I feel for ya!

SM

May 30th, 2012
3:23 pm

Regarding the lack of a tip in Italy… over in Europe they acutally PAY their waiters to work. At most places, there is a sign that says “Service is included” so that you know not to tip. It’s actually seen as flaunting your wealth and showing a lack of class. Only in the US do servers have to rely on tips to make a living.

lou grant

May 30th, 2012
3:54 pm

it’s all a misunderstanding…..it’s not a “billion” dollrs…it’s a”brazillian” dollars…worth about $499 american……

Sue!

May 30th, 2012
7:45 pm

Zuckerburg will sue this brokerage firm for all the money he lost in the bungled IPO! His lawyers will ask for big damages!

Homer

May 30th, 2012
8:54 pm

HAHAHAHAHA! When a movie studio hypes a movie for weeks prior to its release you know that the movie is probably not worth watching. When an IPO is hyped weeks before it is released you now know that it is probably not worth buying. I don’t feel a bit sorry for the suckers that thought that they would be millionaires overnight. And if anyone still thinks that Wall Street brokers are straight up then they are fools.

stew

May 30th, 2012
9:56 pm

zuckerberg better have a good prenup–that chick will rip him clean for a couple of billion in a few years when they get divorced.

King Bobby

May 31st, 2012
10:08 am

This will go down as one of the greatest transfers of wealth in history. Obama is madder than a hornet that a white, Jewish kid surpassed him in taking money from the masses and giving it to his friends. In two years, MBA students will be doing research papers on the boondoggle known as Facebook! And don’t worry about Zuckerberg, he already has sell orders in to make more money than some nations take in in years. And the IPO was scheduled prior to the marriage, so she actually would owe him money in a divorce (he’s worth less now that at the marriage). The kid is a sure genius!

T

June 6th, 2012
5:31 am

LOL @ all u farm building, friend having every minute checking FB junkies. Why would any intelligent thinking person buy into this BIG BROTHER BS known as FB. Upon getting sucked in to this FB BS theres even some idiots who sank $$$ into this declining as we speak and soon to be worthless stock. Suckas