On Thursday morning, Facebook stock dropped 20% as the public company is off to face the worst day in its history. Shares fell to a low of $174.48, and it halted stock trading on Wednesday at $217.50, CNBC reported.
Facebook lost the tech stock a total of about $120 billion in market value in just a few hours, bringing down the rest of the sector with it. The social media network was recovering from the Cambridge Analytica fiasco among other scandals as it seems that Facebook’s bad press is catching up to them, slowing down their numbers.
Facebook’s advertising revenue estimates missed the mark, according to CNBC, and even had to warn investors that its growth rates were going to be lower than expected.
“The social network added 22 million daily active users globally during the quarter,” CNN said. “That represents a slowdown from the 41 million daily users it added in the same quarter last year.”
In the second quarter, Facebook recorded 279 daily users – which was down from 282 million in the former. The corporation added new data protection rules and departed from their trending news feed before their most recent stock dive.
Analysts who keep track of Facebook felt “blindsided” by the sharp drop, asking the company’s executives “for more information on exactly how the company’s financial future had changed so dramatically,” Bloomberg said.
“The company was bombarded by public criticism over its content policies, especially in countries such as Myanmar and Sri Lanka where misinformation has led to violence,” Bloomberg stated. “… All of those problems are hitting amid a harsh truth for the company: Facebook, the social network with 2.23 billion active monthly users, can’t grow forever.”
Facebook said that it has a plan to increase spending on new feats like virtual reality and artificial intelligence to supplement their video content. The company’s plunge amid recent changes is definitely a setback for the social media network, as they seek to bounce back in the following quarters.
Are you looking for social media training and experience? Join CMN’s Social Media for Journalism Course and get real-time experience, intense feedback on your writing, exposure to journalism influencers and mentors, and a great place to display your work. You can get academic credit too. Check out the Social Media Course here.
Poll: Almost 40% of College and University Undergraduates Nationwide Favor Socialism
Socialism is slowly rising amongst college youth.
California Bans Discrimination Based on Natural Hairstyles
The Golden State is combating discrimination based on appearance.
The Supreme Court Determines the Fate of Political Representation
The country's high court determines the future of representation.
New Hampshire Becomes the 21st State to Abolish Capital Punishment
The Granite State makes a huge step towards criminal justice reform.
Elijah Manley: The Youngest Person to Ever Run for U.S. President
Meet the youngest person ever to run for U.S. president.