Meta saw $230 billion of its market value disappear into thin air late this week, the biggest single-day drop for any stock in American history.
The slump comes after the company reported a slowdown in user growth, stressing that a decline in the number of views on its sites is more dangerous for social media colossus Mark Zuckerberg than any whistleblower.
Meta shares fell more than 26% on Thursday to close at $237.76 a share, losing about $232 billion in value, the biggest single-day drop in the market value of any stock in U.S. history, according to Dow Jones link to your report. market data.
The previous record for a one-day drop in market value was set by Apple in September 2020, according to Dow Jones data, when the company lost about $182 billion amid a massive tech sell-off.
To give you an idea of how big the $232 billion drop is, that's more than the entire market value of companies like Netflix, McDonald's, Morgan Stanley and AT&T. And this is more than the cost of General Motors, Uber and Barclays combined.
Analysts attribute the shocking wipeout to several trends, but chief among them is the fact that Facebook's user base has shrunk for the first time in the company's history.
In the last quarter of 2021, Facebook's core product Meta's daily active users dropped from 1.930 million to 1.929 million, the first time the company reported a drop in daily usage since its founding 18 years ago.
During an earnings call Wednesday, Meta CEO Zuckerberg said that competitors like TikTok are poaching users. “People have a lot of options for how they want to spend their time, and apps like TikTok are evolving very quickly,” Zuckerberg said. His comments were published in the Washington Post.
The company said most of the decline in usage was in Africa and Latin America. This could be a sign that Facebook's efforts to add as many users as possible seem to have peaked.
And the company's rapid plunge into the metaverse, as evidenced by its huge investments in augmented and virtual reality technologies, has so far been unprofitable.
Meta CEO Mark Zuckerberg told shareholders that the social network is facing stiff competition from fast-growing competitors, including TikTok.
Facebook Reality Labs lost $3.3 billion in the quarter despite generating $877 million in revenue. The loss is just a drop in the bucket compared to the $33.67 billion the company earned last quarter from targeted social media advertising.
