Facebook Inc. investors, already grappling with concerns aboutthe company's growth prospects, are bracing for the biggestincrease in the number of shares free for trading since the companywent public in May.

Restrictions lift today on 804 million shares held by formeremployees and those who sold at the initial public offering, almostdoubling the total available for trading, according to a regulatoryfiling. The bans on sales are put in place to prevent shares fromflooding the market immediately after an initial public offering.Restrictions lifted on smaller numbers of shares in August andOctober.

Facebook, operator of the world's most popular social-networkingservice, has lost about half its value since going public as thenumber of shares rose and investors fretted about the company'sability to boost mobile-advertising sales.

“It has been and will be important to investors without adoubt,” said Scott Kessler, an analyst at S&P Capital IQ, whohas a hold rating on the stock and doesn't own it. “This isobviously something that people have been thinking about andconcerned about.”

Two more rounds of lockup expirations remain through May.Facebook will free up about 156 million shares for stockholders,except Chief Executive Officer Mark Zuckerberg, who sold in theIPO. The company will free up another 47.3 million shares May 18.This lot includes stock held by Russia's DST Global Ltd.

Shares held by Zuckerberg aren't part of the tally because hehas said he won't sell before September of next year.

Ashley Zandy, a spokeswoman for Facebook declined tocomment.

Facebook, based in Menlo Park, California, fell 1.1 percent to$19.86 at the close yesterday in New York. The shares have declined48 percent since the IPO.

The new lockup expiration may present only “limited downside,”Brian Wieser, an analyst at Pivotal Research Group, wrote in aresearch note this week. Many investors probably won't sell as soonas possible, given recent stock price declines, he said in aninterview.

“While the number of shares is significant, the market should becapable of handling the trading that results from the lock-upexpirations,” Wieser said.

Facebook, which makes most of its money from advertising,reported sales rose 32 percent to $1.26 billion in the thirdquarter, matching the growth of the second quarter. That's aslowdown from 45 percent growth in the first quarter and 55 percentin the fourth quarter.

Still, third-quarter revenue topped estimates of $1.23 billionas Facebook benefited from efforts to sell advertising on mobiledevices, where users are increasingly accessing the service. Theresults from new ad services show promise, improving the company'sgrowth prospects, said Colin Sebastian, an analyst at Robert W.Baird & Co.

“We recommend investors take a longer-term view than justnear-term lockup issues,” Sebastian said. “We look at thefundamentals and see Facebook as becoming a legitimate ad platformover time.”

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