Facebook loses tenth of value after Wall St update

The hefty spending plans exposed the first signs of stress in the rock-solid support that investors have accorded the US company over the past year.

With Facebook’s mobile advertising business delivering repeated quarters of breakneck revenue growth, the company has faced little pushback from investors on pricey, multi-billion dollar acquisitions such as WhatsApp and Oculus.

The social network is preparing for a 55 per cent to 75 per cent spike in expenses next year, when the world’s largest social network intends to invest in products that have yet to show a profit.

That’s a big change from the company’s current spending patterns, with costs and expenses in the first nine months of 2013 up a relatively modest 32 per cent.

Facebook declined to provide any estimates for its expected pace of revenue growth in 2015, adding to investor worries.

Chief executive Mark Zuckerberg has told Wall Street he is in no hurry to extract a payoff from the collection of acquired products, stressing the importance of growing the number of users first.

“For us products don’t get that interesting until they have about a billion people using them,” Mr Zuckerberg said.

Facebook’s European policy chief is Lord Allan of Hallam, the former Sheffield Liberal Democrat MP.