Facebook is listed on the Nasdaq stock exchange, shown on the board in Times… (Carolyn Cole / Los Angeles…)
Facebook resisted prodding by the U.S. Securities and Exchange Commission to disclose more about the risks from a burgeoning user base accessing the social-networking site from mobile devices, according to a news report.
A lengthy article by Bloomberg News highlights letters between Facebook and the SEC's corporation finance division, which oversees what publicly traded companies disclose in regulatory filings before their initial public offerings.
The letters, made public by the SEC, "depict a management team hesitant to disclose information and still guessing at even rudimentary aspects of its business just weeks before the company held the largest-ever technology initial public offering," Bloomberg News reported. "Many of the issues raised by the SEC and now unnerving investors were foreshadowed in the then-private correspondence between the SEC and Facebook."
In one instance, for example, the SEC noted in March that Facebook had double-counted some of its mobile users. “Please explain to us how you determined that your metrics are not overstated,” the SEC wrote to the company.
Facebook later noted difficulties in generating revenues from a growing mobile user base in an amended regulatory filing before its IPO in May.
The exchanges with regulators are likely to add scrutiny to Facebook's IPO. The company's debut was fraught with technical glitches on the Nasdaq stock market. Then came a firestorm over news that disclosure of dimming forecasts for Facebook's profitability was made to only some investors.
Facebook's stock has suffered since it debuted at $38 a share. In early trading Wednesday, Facebook's stock lost 64 cents, or 3.2%, to $19.59 a share.
FB data by YCharts
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