Morning Business Memo
Facing up to slower growth. Weeks before its widely anticipated initial share offering, Facebook says first quarter profits and revenue fell from the last three months of 2011. The social network firm's expenses are growing and it will be under pressure from investors to perform. Facebook does have a vast network of global users. More than 900 million people have signed up. Other Web companies that recently launched IPOs "have struggled with their financial results and spending," according to the Wall Street Journal. Groupon and online game company Zynga are two examples.
Netflix shares plunged more than 16 percent in premarket trading. The video subscription firm forecasts much slower growth of subscribers to its streaming service later this year than during the first quarter. The company expects another decline in DVD users.
The wild ride for Apple shares is likely after the hugely successful company releases its quarterly profit reports today. Apple shares are down more than 10 percent from the recent peak, but up more than 30 percent this year. Wall Street analysts expect first quarter Apple profits to surge more than 50 percent compared with the year before.
How much is your home worth? Two new reports on housing come out this morning: The Case-Shiller 20-city price index for March could show another decline. The government's new homes sales survey will also be released. Doug Lebda CEO of LendingTree.com says tough lending standards by the banks are holding back the recovery. "It all comes back to availability of credit for consumers,which is still very tight," he says. "My take is that things are improving year over year in the housing market in general, but we have a very long and bumpy road to recovery."