Facebook has become a victim of its own success.
The social networking giant beat expectations for its third-quarter earnings, but still failed to impress investors with the share price sliding as much as 10 percent in after-hours trading.
Investors were likely responding to the realization that Facebook already has seized the largest portion of the mobile market and its growth rate in the space is plateauing, said Lou Basenese, founder of the research firm Diruptive Tech Research.
"They beat on every metric, the only thing that I can see is that this becomes about mobile monetization, and I think that investors see that they have already captured the dominant part of the market," Basenese said.
"The question went from can they monetize mobile to how much is there left to monetize?" he said.
In the second quarter, Facebook's mobile ad sales accounted for 67 percent of all ad revenue. For the third quarter, mobile made up slightly less of all ad sales at 66 percent, but it was still up significantly from a year ago when mobile revenue only represented 49 percent of advertising dollars.
The social media giant reported third-quarter earnings of 43 cents per share on $3.20 billion in revenue, beating expectations for 40 cents per share on $3.12 billion in revenue, according to a consensus estimate from Thomson Reuters.
"This is a really good quarter, they are hitting all metrics," said Kevin O'Leary of O'Leary Funds, on CNBC's "Closing Bell."
"They have turned this platform into a measuring metric. When people say online advertising what they really mean is Facebook or Google."
Now the challenge Facebook faces is continuing to compete against hot new start-ups, analysts said.
While a lockup period for about 8.8 percent of Facebook's outstanding stocks (more than 170 million shares) expires later this week, it's unlikely it has much to do with how investors responded to the company's earnings, Basenese said.
"The lockup is getting overplayed. I don't foresee a mass exodus, the numbers were still too strong," he said.