It would be all too easy to say that Facebook's market meltdown is coming to an end. Afterall, Mark Zuckerberg's social network burned as much as $ 50 billion of shareholders' wealth injust a couple months. To put that in context, since its debut(初次登台) on NASDAQ in May,Facebook has lost value nearly equal to Yahoo, AOL, Zynga, Yelp, Pandora, OpenTable,Groupon, LinkedIn, and Angie's List combined, plus that of the bulk of the publicly tradednewspaper industry:

　　As shocking as this utter failure may be to the nearly 1 billion faithful Facebook usersaround the world, it's no surprise to anyone who read the initial public offering (IPO)prospectus (首次公开募股说明书). Worse still, all the crises that emerged when the companydebuted-overpriced shares, poor corporate governance, huge challenges to the core business,and a damaged brand-remain today. Facebook looks like a prime example of what Wall Streetcalls a falling knife-that is, one that can cost investors their fingers if they try to catch it.

　　Start with the valuation(估值). To justify a stock price close to the lower end of theprojected range in the IPO, say $ 28 a share, Facebook's future growth would have needed tomatch that of Google seven years earlier. That would have required increasing revenue by some80 percent annually and maintaining high profit margins all the while.

　　That's not happening. In the first half of 2012, Facebook reported revenue of $ 2.24 billion, up38 percent from the same period in 2011. At the same time, the company's costs surged to $ 2.6 billion in the six-month period.

　　This so-so performance reflects the Achilles' heel of Facebook's business model, which thecompany clearly stated in a list of risk factors associated with its IPO: it hasn't yet figured outhow to advertise effectively on mobile devices, The number of Facebook users accessing thesite on their phones surged by67 percent to 543 million in the last quarter, or more than half itscustomer base.

　　Numbers are only part of the problem. The mounting pile of failure creates a negativefeedback loop that threatens Facebook's future in other ways. Indeed, the more Facebook'sdisappointment in the market is catalogued, the worse Facebook's image becomes. Not onlydoes that threaten to rub off on users, it's bad for recruitment and retention of talentedhackers, who are the lifeblood of Zuckerberg's creation.

　　Yet the brilliant CEO can ignore the sadness and complaints of his shareholders thanks tothe super- voting stock he holds. This arrangement also was fully disclosed at the time of theoffering. It's a pity so few investors apparently bothered to do their homework.