8.30am ET/1.30pm BST: Mark Zuckerberg will ring the bell for the opening of the Nasdaq stock market at 9.30am as he kicks off a share sale that will value the company at $104bn.
We'll be live blogging the day's events here in New York, and you can see how the fortunes of Zuckerberg and the social network crew rise (or fall).
Not since Google's initial public offering (IPO) has a share sale been as closely watched. It's Super Bowl for social media: every commentator in the land has an opinion on whether the firm is really worth that sort of cash, and is lining up to share it.
At $104bn, Facebook is being valued at more than the combined value of Nike and Goldman Sachs. Last year Facebook had revenues of $3.7bn. Goldman's were 10 times that.
But this is a company with massive potential. Facebook will have more than a billion people logging in to its service this year – that's more than three times the populations of the US – and it hasn't got started in China. Nearly 400 million people log on six days a week. In the first three months of this year those people "liked" or commented on Facebook items 3.2bn times a day.
Google added a verb to the lexicon; Facebook redefined "friend" and "like". Now Zuckerberg has to find a way to make his social network live up to its massive promise.
8.30am ET/1.30pm BST: Mark Zuckerberg will ring the bell for the opening of the Nasdaq stock market at 9.30am as he kicks off a share sale that will value the company at $104bn.
We'll be live blogging the day's events here in New York, and you can see how the fortunes of Zuckerberg and the social network crew rise (or fall).
Not since Google's initial public offering (IPO) has a share sale been as closely watched. It's Super Bowl for social media: every commentator in the land has an opinion on whether the firm is really worth that sort of cash, and is lining up to share it.
At $104bn, Facebook is being valued at more than the combined value of Nike and Goldman Sachs. Last year Facebook had revenues of $3.7bn. Goldman's were 10 times that.
But this is a company with massive potential. Facebook will have more than a billion people logging in to its service this year – that's more than three times the populations of the US – and it hasn't got started in China. Nearly 400 million people log on six days a week. In the first three months of this year those people "liked" or commented on Facebook items 3.2bn times a day.
Google added a verb to the lexicon; Facebook redefined "friend" and "like". Now Zuckerberg has to find a way to make his social network live up to its massive promise.
8.52am ET/1.52pm BST: Trading action on Facebook shares is not likely to commence until 10:30am ET at the earliest, as bankers work through the mechanics of the offer, market sources said.
9.13am ET/2.13pm BST: The delayed debut of Facebook stock this morning affords us time for a walk down memory lane... back to 2004, when FB chief Mark Zuckerberg was still just a cocky college student bragging about his hacking exploits in instant messages to friends.
Those messages are now a matter of public record. The Guardian's Josh Halliday writes:
Zuckerberg appears to confirm in one message that he secretly hacked into the website of the Harvard University newspaper, the Crimson, by guessing the emails and passwords of two people in the college database.
"So I want to read what they said about me before the article came out and after I complained," he told a friend. "So I'm just like trying the email/passwords of everyone who put that they're in the Crimson. I wonder if the school tracks stuff like that."
In another message, Zuckerberg boasts about deactivating college students' accounts on the internal Harvard social network, ConnectU. "I got bored so I started deactivating accounts on ConnectU haha," the future cyber-grandee writes.
9.23am ET/2.23pm BST: CNBC, which is tracking the Facebook IPO, is reporting on the overnight "hackathon" at the company's Menlo Park, California, campus. In the run-up to today's big splash, employees spent the night at their place of work writing computer code, over-caffeinating and giving their eyes a little extra practice staring at computer screens. The event reflects the company's youthful, creative, spontaneous, creative culture.
Employees ordered Chinese food and there was talk of them making a run to In-n-Out Burger, CNBC reports. How does the news change your bet on what Facebook stock will do today? Let us know in the comments.
9.28am ET/2.28pm BST: Hackathon Update. It turns out there was one Facebook face who declined to participate in last night's ritual of camamaderie and computer fun. Zuckerberg apparently called it a night early in the evening, Josh Halliday reports. He went home to his girlfriend Cilla and their Hungarian sheepdog, Beast.
When you're the boss you get to do that.
9.30am ET/2.30pm BST: Mark Zuckerberg has just rung the bell opening the Nasdaq market. He did so from a stage at the company's Menlo Park HQ. Then he hugged COO Sheryl Sandberg. The stage is full of other FB execs, with a sea of employees all around. A boom camera is capturing the action in the cheering, waving crowd. Looks like Bonnaroo. "A Woodstock event," someone on CNBC just called it.
9.39am: The scene at Facebook HQ in Menlo Park in the run-up to the IPO. The company is valued at $104 billion as shares go on sale to the public.
9.36am ET/2.36pm BST: The Guardian's Dominic Rushe has been talking to David Kirkpatrick, author of The Facebook Effect – the only book written so far with Facebook's cooperation – and a man who has spent many many hours with Mark Zuckerberg.
"His impact on the world will be as least as big as Bill Gates and probably already has been," Kirkpatrick tells Rushe. "Like Gates I'm positive he is going to end up being one of the world's great philanthropists. I believe he has a very strong social conscience."
He says this will be a big day for Zuckerberg but that while the Facebook boss may party later, he'll try to keep things as normal as possible once he has rung the bell.
Then the real work begins...
"I spoke to Peter Thiel [Silicon Valley investment legend and one of Facebook's early backers] and he said Facebook had this peculiar quality, it will either completely dominate or it will completely go away. I don't think it's going away anytime soon though."
Fitzpatrick predicts that Zuckerberg could soon be the world's richest man.
9.40am: One take on the big offering.
Wocka! Wocka! twitter.com/dmataconis/sta…
— Doug Mataconis (@dmataconis) May 18, 2012
10.10am ET/3.10pm BST: Facebook is summoning great spectacle in its rollout this morning – but will the stock price hold up? When the excitement dies, will the company warrant its $104 billion valuation, and the $38 share price?
One main place investors locate value in Facebook is its potential power as an advertiser. With 900 million users and counting – and a potentially vast market in China still waiting to be tapped – Facebook has an unparalleled capacity to put ads in front of eyes.
But earlier this week, US auto manufacturer GM decided that those ads weren't worth it, ending its Facebook campaign. The company had been spending $10 million a year to advertise on the site, but none of the reports measuring those ads' profitability came back positive. The Economist spoke with Chris Perry, marketing chief for GM's brand Chevrolet, who confirmed that "a routine marketing review concluded that the site delivered 'insufficient' results.
Companies still believe that Facebook is an indispensable tool for spreading buzz about new products, however:
That viewpoint was echoed by the senior media buyer at a major Detroit ad agency, who asked not to be identified by name because he is not authorised to discuss strategy with the press. Based on clicks-throughs alone, he says, Facebook "doesn't pay off." His agency's approach is to use the service as part of broader social media campaigns.
10.21am ET/3.21pm BST: Facebook co-founder Eduardo Saverin came in for a drubbing last week when it was revealed that he had disclaimed US citizenship in favor of residence in Singapore, which does not have a capital gains tax. Saverin responded to the criticism by saying that his move was not a tax dodge; he simply prefers Singapore.
Last night Saverin set the controversy aside to offer his former colleagues a hearty congratulations on his personal Facebook page. He misspelled his co-founder's name – but it's the thought that counts?
On the eve of the Facebook public float, 8-plus years in the making, I as co-founder wanted to look back and cherish Facebook's early beginning. Congrats to everyone involved in the project from day one till today, and I especially wanted to congratulate Mark Zukerberg [sic] on keeping tremendous stead-fast focus, however hard that was, on making the world a more open and connected place.
10.37am ET/3.37pm BST: A major status update for the Facebook cofounder: as Mark Zuckerberg rang the bell to open the Nasdaq exchange, his account automatically spread the news.
Mark Zuckerberg's Facebook status update.
Zuckerberg tagged fellow executives Chris Cox, vice president of product; the chief finance officer David Ebersman; the vice president of finance Cipora Herman; and his trusted No 2, Sheryl Sandberg.
A chart illustrates the growth of total Facebook users.
10.46am ET/3.46pm BST: Facebook as a growing concern. Whatever happens with the stock price today, the immense market draw of the company is plain to see in a chart tracking users, from about 300 million in March 2009 to 900 million today (blue is all Internet users worldwide; brown/gray is FB users):
10.42am ET/ 3.42pm BST: T-minus three minutes and counting: Nasdaq has just announced that trading in Facebook shares will begin at 10.45am ET.
11.02am ET/4.02pm BST: Reuters is reporting that the opening of trading has been pushed back a bit:
RT @ProducerMatthew: Reuters: Facebook IPO extended by additional 5 minutes, to trade at 11:05 AM ET - NASDAQ
— Anthony De Rosa (@AntDeRosa) May 18, 2012
11.23am ET/4.23pm BST: Nasdaq has announced that there has been a delay in the start of Facebook trading. We're reaching out to sources at Nasdaq to find out more about the holdup.
The latest delay is the third or fourth of the morning. Nasdaq itself puts out time call information. Meaning the market itself is failing to predict when the market will go to work.
The Wall Street Journal is now reporting that traders are having problems changing or canceling their orders ahead of the Facebook IPO.
Will Zuckerberg have to change his status again?
11.27am ET/4.27pm BST: IPO delayed indefinitely by glitch in market: This isn't the headline Facebook was looking for this morning.
Wow, Nasdaq found the only way possible to upstage the Facebook IPO.
— Heidi N. Moore (@moorehn) May 18, 2012
11.30am ET/4.30 pm BST: Mark Zuckerberg and colleagues ringing the opening bell for Nasdaq at 9.30am ET.
Looks anticlimactic now.
11.30am ET/4.30pm BST: And they're off. Facebook is now on sale – and the first shares cross at $42.05, a good deal higher than the $38/share rollout price.
For the time being, at least, the company has 100 billion reasons to cheer.
11.34am ET/4.34pm BST: How big is trader interest in Facebook? 82 million shares were traded in the first 30 seconds, according to Nasdaq.
The stock price is bumping along at the $40-$41 level. You can follow the stock price here.
11.36am ET/4.36pm BST: How will Facebook shares perform in the first day of trading? Tell us what you think.
For extra credit, let us know in the comments what you think the high price and the low price of the day will be.
11.50am ET/4.50pm BST: As the Facebook share price settles back to $38, The Guardian's Nils Pratley contributes his analysis of the pricing dynamics. If the stock goes too high, insiders who sold in advance of the IPO may resent the investment bank. A share price of around $41 would satisfy most everyone, Pratley writes:
A 10% pop should satisfy the IPO advisers. When you start getting to 20%-plus, the insiders who are selling feel short-changed and accuse the investment bank advisers of misjudging demand. 10% is ok - it meets the "leave something on the table for the next person" rule.
11.56am ET/4.56pm BST: A look back at the hot tech IPO of 20 years ago:
Celebrating Facebook IPO today while reflecting on AOL IPO 20 years ago. Valuation was $70 million. Most thought Internet was a fad. #wrong
— Steve Case (@SteveCase) May 18, 2012
12.03pm ET/5.03pm BST: One stock that really doesn't like what it's seeing in the Facebook IPO: Zynga, the Internet gaming company.
Zynga, which depends on Facebook for a platform for its games, had an underwhelming IPO of its own in December, when it fell 5 percent in its first day of trading.
So far today Zynga is down 13 percent.
UPDATE 12.07pm ET: Trading in Zynga shares has now been halted.
12.18pm ET/5.18pm BST: Facebook stock has been out of the gate for 50 minutes. After opening at just above $42 the stock dropped to the break-even level of $38. But instead of continuing to fall, the stock staged a resolute recovery:
Facebook's share price dropped to $38 before staging an abrupt recovery.
So what happened? Here's Dominic Rushe:
Facebook's shares came dangerously close to falling below $38, the offer price, and have now rallied. This chart shows what happened. The speculation is that the underwriters have piled in and supported the price that we are chasing now. If it's true, they can't support the price forever and you can expect FB's shares to fall next week.
But – and it's a big but – there have clearly been problems with the IPO at Nasdaq, orders for shares were backed up and may have caused these weird price movements.
There are however signs that investors are underwhelmed. Zynga shares were suspended after they crashed this morning – not a good sign as the game firm is largely dependent on Facebook for its business.
12.34pm ET/5.34pm BST: Have underwriters stepped in to hold Facebook shares above $38?
A screen grab of the order book for Facebook. The big yellow block represents bids for shares at $38.
Business Insider gets a look at the order book, sent in by Twitter user @Bourbon_Meyer.
"It strongly appears that there's a huge perma-bid at $38 on Facebook," Joe Weisenthal writes. "Check out the big mass of yellow on the left column... all those bids at $38."
12.39pm ET/5.39pm BST: If you don't own Facebook shares yet, are you currently missing an historic opportunity to get in on the ground level of a company that's about to break all previous records for stock growth?
Warren Buffett apparently doesn't think so. Here's what the Oracle of Omaha has to say about IPOs in general:
It's almost a mathematical impossibility to imagine that, out of the thousands of things for sale on a given day, the most attractively priced is the one being sold by a knowledgeable seller (company insiders) to a less-knowledgeable buyer (investors).
12.55pm ET/5.55pm BST: Facebook staffers have flocked to the social network to bask in the post-IPO glow, the Guardian's Josh Halliday reports.
Lindsey Cochran, who works in marketing at Facebook, writes: "I vividly remember signing up for facebook in the upstairs quad of 508 Thurston ... in April of 2004. I can't believe I am now going to be a part of such a historic moment. Feeling incredibly lucky!"
A status update from Lindsey Cochran of Facebook.
Gabe Hernandez, another staffer, says: "While I won't be in any of the Facebook offices to celebrate today, I am wearing my hoodie in solidarity. Thanks everyone for making my job far from the last place I ever want to be. Now stay focused and keep hacking!"
A status update from Facebook staffer Gabe Hernandez.
Meanwhile, Zuck has returned to his Facebook to note: "This is a pretty awesome hack."
1.09pm ET/6.09pm BST: Till death do us part – or your company doth go public. Will the Facebook IPO cause a spike in shareholder divorces as new millionaires are created and relationships become more liquid, as it were? The Financial Times has a morbidly droll (and paywall-protected) report:
"When Google went public, there was a wave of divorces. When Cisco went public there was a wave of divorces," says Steve Cone, a divorce attorney based in Palo Alto, near the social network's Menlo Park headquarters. "I expect a similar wave shortly after Facebook goes public."
1.16pm ET/6.16pm BST: Dominic Rushe checks in on the Internet gaming company Zynga, and what the poor performance of its stock today could mean for Facebook:
Facebook's shares have recovered after dropping worryingly close to their $38 offer price. But over at Zynga there are still problems.
As we mentioned earlier, it looks likely that Facebook's battalion of bankers moved to make sure FB didn't drop below $38. Zynga had no such luck and was down more than 13% at one point. It's now down nearly 6%.
Zynga is basically a way to trade Facebook, since nearly all of its business comes from the social network. So is this what FB's share fall would look like if the bankers hadn't piled in? Just sayin'.
1.22pm ET/6.22pm BST: Guardian tech editor Charles Arthur looks at what's next for Facebook:
What to expect now? Don't be surprised if the next big thing is a Facebook phone – running its own software and developed from top to bottom to involve you in the site all the time.
Zuckerberg's team has been advised to do this directly, because it needs to reach the "next billion" internet users, and they are mainly going to be using mobile phones, not desktop or laptop computers. Selling its own phone would mean it could make itself the background hum of many peoples' lives everywhere – and show adverts and collect data on its own terms.
Read Charles' full analysis here.
1.55pm ET/6.55pm BST: Bloomberg reports that Facebook underwriters did in fact start buying shares at $38 to keep the stock from falling below its offer price:
Facebook Inc. (FB) underwriters purchased the company's stock to keep it from falling below $38 a share after debuting on the Nasdaq Stock Market, people with knowledge of the matter said.
The bankers supported the stock after Nasdaq OMX Group Inc. (NDAQ) faced difficulties delivering trade execution messages after the initial public offering, said one of the people, who asked not to be identified because the transactions are private.
Passers-by are reflected in the window of the Nasdaq media center as they view reports of trading activity on Facebook's stock. Photograph: Bebeto Matthews/AP
1.42pm ET/6.42pm BST: If you haven't checked out our live tracker of top Facebook shareholders' wealth based on today's fluctuations in the FB share price, you can have a look here. For the record, Mark Zuckerberg is currently "worth" more than $20 billio
2.59pm ET/7.59pm BST: One person we haven't heard a lot from today is Sheryl Sandberg – but expect that to change. Here's Dominic Rushe:
Sandberg is one of the most impressive execs in the US with a resume that includes the US Treasury, Google and McKinsey. You can read my profile of her here.
Sandberg was late to the Facebook party; she joined in 2007 when Zuckerberg poached her from Google. Back then Facebook had 70m users and no profits. How things change. She holds 1.9m shares and has made a small fortune today.
Sandberg stands to make a far larger fortune in the near future. She has 39m restricted stock units, most of which are tied to performance targets. If she hits them – and history suggests she will – Sandberg will become a billionaire, which is a rarity for employees. That kind of reward usually goes to the founders, not the help.
2.52pm ET/7.52pm BST: Dominic Rushe places the Facebook stock performance in the context of the lackluster Nasdaq showing this week:
"OK I admit it. I've had a bit of a downer on Facebook at $100bn plus. It's an amazing company but I just don't think it's proven worthy of that kind of valuation yet. And maybe bankers are propping the share price up.
A tough week for Nasdaq.
"Even so, today's performance needs to be set against what has been happening to the rest of the Nasdaq companies this week. One look at this graph of the Nasdaq over the last five days shows, this wasn't an easy week to launch."
3.02pm ET/8.02pm BST: With an hour to go until the Nasdaq close, Facebook's shares are at $39 a share and Mark Zuckerberg has outpaced several of the world's richest men.
With wealth of over $21bn, Zuckerberg is now worth more than Jeff Bezos at Amazon or either of the Google founders, according to the Forbes list of billionaires. He was briefly richer than New York mayor Mike Bloomberg, but has now just slipped behind B's $22bn pile. Poor thing.
3.20pm ET/8.20pm BST: Has the Facebook IPO been a success? With 45 minutes to go until the closing bell, the stock is slowly sinking from around the $40/share range back to its opening price of $38. In the New Yorker, John Cassidy sees a party that fizzled:
At 11:30, the stock opened at $42, jumped up to $43, fell back $42—and kept falling, back to $40. "For market sentiment, this is not going to be positive," said Simon Hobbs, the network's resident Brit. Melissa Lee was equally crestfallen: "Forty minutes ago, I don't think anybody thought $40," she said. David Faber had been working the phones, and he reported that his sources had told him the stock might well fall below the issue price of $38, which would be a big embarrassment to the banks underwriting the deal, led by Morgan Stanley. "The big story is that Facebook, the social network, is now a public company," he said. "The smaller story is that after five minutes, it's only up six per cent."
Henry Blodget, in contrast, congratulates the investment banks for rolling out a stock that was "perfectly priced":
This price level was ideal for almost everyone involved--with the exception of short-term traders who bought the stock only to instantly flip it. (And no one should cry for them).
With such a modest pop, Facebook and its selling shareholders did not leave tens or hundreds of millions (or even billions) of dollars on the table--an expensive mistake that most companies make.
When LinkedIn went public, for example, the bankers underpriced the deal, and the company needlessly handed $100+ million to institutional investors.
Heidi N. Moore has been arguing that the failure of the stock to lift and hold above its initial offer price of $38 is making for a "rocky" debut.
What you're not seeing right now is 33 banks all seeking to blame each other for why this stock is barely clinging to a decent open. $$ FB
— Heidi N. Moore (@moorehn) May 18, 2012
3.26pm ET/8.26pm BST: Here's a eye-catching list from Heidi N. Moore, comparing Facebook to other big companies in terms of market value and revenue. She calls the list "One of These Things Is Not Like the Others: Facebook Edition."
At $40/share, Facebook ranks 6 out of 10 in terms of market value ($112bn).
Guess where Facebook ranks in terms of revenue?
Google: Market value $200 billion; 2011 revenue $37.9 billion
JP Morgan Chase: Market value $127 billion; 2011 revenue $99.8 billion
Verizon: Market value $117 billion; 2011 revenue $110.9 billion
Merck: Market value $115 billion; 2011 sales $48 billion
GlaxoSmithKline: $112 billion; 2011
sales $44 billion
Facebook: Market value $112 billion; 2011 revenue $3.7 billion
Anheuser-Busch: Market value $111 billion; 2011 revenue $39 billion
PepsiCo: Market value $109 billion; 2011 revenue $66.5 billion
McDonald's: Market value $91 billion; 2011 revenue $27 billion
Cisco Systems: Market value $89 billion; 2011 sales $10.4 billion
3.41pm ET/8.41pm BST: Facebook stock on the day of its IPO after four hours of trading: $38.
Facebook share price at 3:38pm ET. Looks familiar.
3.50pm ET/8.50pm BST: Facebook shares seem to be trying their hardest to sink below the $38 offer price. The underwriting banks are in the market to shore up that price. And they're dealing with a lot of volume: record volume, in fact.
The previous record for most shares traded on the day of an IPO was set by General Motors Co. (GM), at 458 million. With 10 minutes to go in the trading day, Facebook has already smashed the record with 532 million.
3.54pm ET/8.54pm BST: And this, folks, is as good as financial TV gets.
EPIC: FACEBOOK UNDERWRITERS WAGING HUGE BATTLE HAPPENING RIGHT NOW TO HOLD THE $38 LEVEL read.bi/M24r5A
— Joseph Weisenthal (@TheStalwart) May 18, 2012
4.00pm ET/9pm BST: And the close: Facebook shares end their first day of trading at $38.23 – up 23 cents a share on record volume.
4.06pm ET/9.06pm BST: Here's what the last hour of trading looked like for Facebook. Down to $38 and then flat, flat, flat. It's almost as if there was an artificial floor holding it there.
Facebook investors held the stock at $38 for the better part of the final hour of trading.
4.10pm ET/9.10pm BST: It's hard to see how the headlines now aren't hard on Facebook. The market didn't want the stock at that price.
Some schadenfreude on Twitter:
Currently lol'ing at the people who thought $FB would close at > $60 today.
— Ethan Klapper (@ethanklapper) May 18, 2012
After final trading volume of 565 million shares, an IPO record, the price didn't move.
Hey, keep it on the down low, but I hear there is still a chance to get in on the Facebook IPO at the offering price!
— James Sununu (@jsununu) May 18, 2012
4.47pm ET/9.47pm BST: Heh.
My two cents: Whole lot of frantic for 38 penny advance in share price.
— david carr (@carr2n) May 18, 2012
4.50pm ET/9.50pm BST: The Securities and Exchange Commission announces that it will investigate what caused the delay this morning in the
Facebook rollout, CNBC is reporting.
The regulator will look into why it apparently was that not all traders had the same information at the expected time.
4.55pm ET/9.55pm BST: We're going to wrap up our live blog coverage of the Facebook IPO. It wasn't the fireworks display some investors expected to see.
This morning market watchers were discussing whether Facebook would post double-digit gains in its first day. Precedents such as LinkedIn, which jumped 107 percent in its May 2011 IPO, made it seem possible that Facebook could hit $50 or higher.
It has been a tough week for the markets in general – the worst week for stocks in all of 2012 so far, in fact. The Dow dropped 450 points this week, or 3.5 percent. The Nasdaq and S&P 500 were both down.
But the spectacle of the underwriting banks that set Facebook's offer price of $38 having to buy shares for the final hour of trading to shore up that price made the offering feel flat.
Here's a summary of what happened:
• Facebook ended the day virtually even. The stock opened at $38. The stock closed at $38.23 (up .61 percent).
• The company shattered the record for IPO volume, with 565 million shares changing hands. GM held the previous IPO volume record with 458 million shares.
• Because of a Nasdaq glitch, in which traders were unable to get confirmation of their trades early in the day, the IPO was rolled out about a half-hour later than expected. The first Facebook shares traded at 11.30am ET. The SEC has announced it is investigating.
• At today's valuation, Mark Zuckerberg's Facebook fortune tops $20 bn.