The company lost over a quarter of market value amid the shares’ drop, dragging down other tech stocks
Meta (formerly Facebook) shares dropped around 26% at the opening of trading on Thursday after Facebook’s quarterly report missed earnings expectations. The report also revealed that the number of the social media platform’s global daily active users declined from the previous quarter for the first time on record, to 1.929 billion from 1.93 billion.
Amid the nosedive, the company’s market value plunged by $240 billion to about $660 billion.
Meta blamed Apple and TikTok for Facebook’s poor performance, claiming Apple’s privacy changes to its operating system made it difficult for brands to use advertising mechanisms on Facebook and Instagram.
The report also cited macroeconomic issues like supply chain disruptions as one of the reasons behind low fourth quarter earnings, while in his conversation with investors, Meta CEO Mark Zuckerberg complained that Facebook is facing growing competition from rivals like TikTok.
Statistics show that at its current level, Meta’s drop is the largest single-day collapse in US market history.
Moreover, the Meta plunge has triggered a sell-off on the tech-oriented Nasdaq composite index, with S&P 500 shedding 1.6%, while the Dow Jones Industrial Average lost 0.8% as of 17:00 GMT. Twitter, Snap, Spotify, and a number of other social media companies were among the stocks which also lost value following Meta’s drop.
Thursday’s stock crash could wipe out around $24 billion, or nearly 20%, of Facebook founder Mark Zuckerberg’s net worth, according to the Bloomberg Billionaires Index. The drop in Zuckerberg’s wealth from $120 billion to $97 billion would rank among the biggest ever, only rivaled by Tesla co-founder Elon Musk’s fortune swings. Musk lost $35 billion in one day in November last year when Tesla stock dropped after Musk’s Twitter poll on the sale of Tesla shares.
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