Facebook's opening price on the IPO was $42.05, up 10.6%

On the evening of May 18, 2012, Facebook was listed on the Nasdaq at 11:30 a.m. Eastern Time on Friday, with an opening price of $42.05, up 10.6% from the issue price of $38.

Due to the excessive pressure on the Nasdaq system caused by the frequent transactions of retail investors, Facebook's opening time was forced to be delayed by 30 minutes. After the opening, Facebook's stock price continued to fall, and once fell to the issue price of US$38. As of 23:59 Beijing time, Facebook was reported at US$39.81, up 4.52%.

The world's largest Internet company IPO

Facebook's IPO (initial public offering) was priced at $38, with the trading code "FB". It sold 420 million shares and raised $16 billion. Based on this issue price, Facebook's valuation was $104 billion, setting a record for the highest valuation of a US company ever listed.

As underwriters have an over-allotment right of 63 million shares, Facebook's IPO financing is expected to reach $18.4 billion, far exceeding the $2 billion raised by Google in 2004, making it the world's largest Internet company IPO.

Morgan Stanley, JPMorgan Chase, Goldman Sachs, Bank of America Merrill Lynch, Barclays, Allen & Company, Citigroup, Credit Suisse and Deutsche Bank are the lead underwriters for the deal. RBC Capital Markets and Wells Fargo are co-underwriters.

The prospectus shows that Facebook founder and CEO Mark Zuckerberg holds 28.1% of the shares, totaling 503.6 million shares, making him the largest individual shareholder, and his net worth will reach $19.1 billion after the listing. This figure exceeds that of Google founders Larry Page and Sergey Brin, making Zuckerberg the 29th richest person in the world.

In addition, Facebook co-founder Dustin Moskovitz holds 7.6% of the shares, and Peter Thiel holds 2.5%. Among institutional shareholders, Accel Partners holds 11.4% of the shares, becoming the biggest winner, followed by DST with 5.4%.

According to the listing documents, Facebook's revenue in fiscal year 2011 was $3.7 billion, operating profit was $1.756 billion, and net profit was $1 billion. In the fourth quarter of fiscal year 2011, Facebook's revenue was $1.131 billion, operating profit was $548 million, and net profit was $302 million.

In the prospectus, Zuckerberg specifically mentioned the company's vision: "Facebook was not created to become a company. It was created to fulfill a social mission: to make the world more open and more connected." In addition, he believes that Facebook's five core values ​​are: focus on influence, act quickly, forge ahead, stay open, and create social value.

Analysts expect big first-day gains

On the eve of the listing, the predictions of Facebook's first-day stock price increase varied widely. Some experts believed that the high IPO price and instability would limit the first-day increase of Facebook's stock price to 10% to 20%. Other experts believed that considering Facebook's high-profile listing, an increase of less than 50% would be disappointing.

"I think anything above 50 percent would be considered a successful listing, and anything below that would be a lackluster offering," said Jim Krapfel, an analyst at Morningstar, a ratings agency. "Many retail investors don't care about valuation, which will drive Facebook's stock price higher on the first day."

"If the market doesn't panic, Facebook's stock price might be able to reach $40," said Scott Sweet, an analyst at market research firm IPO Boutique. "I expect Facebook to have a nice increase on its first day of trading, but given its absolute IPO size, I don't think Facebook will have the same increase as LinkedIn. Facebook's listing will drive other stocks up and trading volume will be heavy." LinkedIn's stock price doubled on its first day of trading.

Facebook's latest financial disclosures cast a shadow on its IPO. Last month, Facebook reported first-quarter sales of $1.06 billion, down 6% from the same period last year; net profit of $205 million, down 32% year-on-year. However, Facebook is still one of the few Internet startups that have recently gone public to have achieved profitability.