Facebook (FB) is shutting down its Hobbi app after it failed to gain traction among users. The quiet announcement came yesterday through a push notification to user devices, saying that the app would be removed from the app store on July 10. The consumer-focused, content creation app was part of Facebook’s push to create a viable competitor to Pinterest (PINS).
Facebook’s stock was up 10.48% at $237.55 as of market close on Wednesday while Pinterest shares also rose 5% to $23.28.
Hobbi was released in February in the iOS App Store under the developer name, “Facebook’s New Product Experimentation (NPE) Team” with an app description saying that it was to “help you document and remember the things you love to do.”
Hobbi was immediately met with low ratings for emulating the photo-discovery Pinterest app too closely as well as the unusual request of requiring users to provide their phone numbers. According to estimates from Sensor Tower, Hobbi only received 7,000 downloads.
Facebook announced its NPE Team last year saying that they will set “the appropriate expectations with users that NPE Team apps will change very rapidly and will be shut down if we learn that they’re not useful to people.” The team has developed 9 other apps of which chat app Bump was also canceled.
Facebook has faced a growing advertiser boycott in the last week after companies cited issues with Facebook not doing enough to combat hate speech and racism on its site.
Goldman Sachs analyst Heather Bellini noted July 1 that the impact of the boycott campaign will have limitations because of Facebook’s “vast advertising base” with a reach to millions of small and mid-sized businesses. Additionally, she believes the company will improve its social media policies in the coming months “which will likely lead to a return to the best-in-class digital advertising platform.” She maintains a Buy rating on the stock with a price target of $265. Her price target suggests 12% growth in the coming months.
Likewise, Canaccord Genuity analyst Maria Ripps reiterated yesterday a Buy rating with a price target of $275 (16% upside potential).
Facebook’s stock is up 16% year-to-date with a Strong Buy analyst consensus that breaks down into 29 Buy ratings, 3 Hold ratings, and no Sell ratings. The $249.11 average price target implies 5% upside potential for the shares in the coming 12 months. (See Facebook’s stock analysis on TipRanks).
Related News:
Facebook Faces More Ad Boycotts, But This Analyst Expects Minimal Impact
Facebook Faces More Ad Boycotts From Major Advertisers
Facebook Files Lawsuits In U.S., Europe Against Abuse On Its Platforms
