Facebook sees biggest drop in market value ever on news it lost users
by Zachary Halaschak, Economics Reporter | THE WASHINGTON EXAMINER
February 03, 2022 09:22 AM | Updated Feb 03, 2022, 10:29 AM
Facebook parent Meta plunged in value by more than 20% after its quarterly earnings report showed that the company was losing daily users for the first time in its history.
Meta’s value cratered by more than $200 billion on Thursday, which would be the biggest one-day decline in market value for a U.S. company in history if the stock remains at the current price at market close.
The quarterly earnings report said that daily Facebook users declined by about a half-million in the last three months of 2021, a prospect that immediately startled investors who fear that the social media giant’s reach has peaked. User losses were greatest in Latin America and Africa, which is a further sign that Facebook has reached peak global saturation, according to the Washington Post.
Meta’s stock was valued at about $250 per share on Thursday morning — a precipitous drop from its Wednesday close of $323.
“Although our direction is clear, it seems that our path ahead is not quite perfectly defined,” said Facebook CEO Mark Zuckerberg to investors Wednesday.
Zuckerberg himself, who has helmed the company since its founding nearly two decades ago, lost about $24 billion of his net worth during the stock’s slump.
Late last year, Zuckerberg announced that the company would rebrand itself as Meta in a nod to the so-called “metaverse,” which is a term for a theoretical digital world. The company has recently focused more of its resources on furthering the metaverse and augmented reality.
The stock market has had a wild ride the past few weeks. Investors are nervous about rising interest rates and uncertainty about the situation in Ukraine. In January, the S&P 500 and some other indexes had the worst month since the start of the pandemic.
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