Meta shares were changing hands at $248.00 in pre-market trading early Thursday — about 23% lower than Wednesday’s closing price of $323.00.
By comparison, $200 billion is more than the entire market value of companies like Netflix, McDonalds, Morgan Stanley and AT&T — or the value of General Motors, Uber and Barclays combined.
Analysts have attributed 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, daily active users for Meta’s core Facebook product fell 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 on Wednesday, Meta CEO Zuckerberg said that competitors like TikTok have siphoned off users. “People have a lot of choices for how they want to spend their time, and apps like TikTok are growing very quickly,” Zuckerberg said.
And the company’s head-first dive into the metaverse — evidenced by its massive investments in augment- and virtual reality technology —Meta CEO Mark Zuckerberg told shareholders that the social network has faced stiff competition from fast-growing rivals 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.
Zuckerberg sounded optimistic, telling shareholders: “Last year was about putting a stake in the ground for where we are heading; this year is going to be about executing.”
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