Behind the numbers: Meta’s nightmare on Wall Street
Meta’s set some undesired records
$200 billion: Meta’s loss in value
After Meta reported a rare decline in quarterly profit on Wednesday, shares in the company plummeted by more than 25%.
The one-day crash wiped over $200 billion off Meta’s valuation. That’s the biggest-ever collapse in market value for a US company.
Analysts attributed the meltdown to several factors: struggles to attract young users, competition from TikTok, Apple’s new privacy changes, and themetaverse.
1.929 billion: Facebook’s active users
Facebook’sdaily active users (DAUs) dropped from 1.93 billion in the third quarter of 2021 to 1.929 billion in the fourth.
It’s a tiny dip on paper, but it marks a grim milestone: the app’s first-ever quarterly decline in DAUs.
User growth was already stalling in the US and Europe, but the biggest losses were recorded in Africa and Latin America. That’s a troubling sign for Facebook’s plans to expand beyond its main markets.
$10 billion: Meta’s loss on the metaverse
One factor behind Meta’s disappointing profits is its vast investment in the metaverse.
The company revealed on Wednesday that Reality Labs – its division for the metaverse – lost more than $10.19 billion in 2021.
This comes as no surprise to Mark Zuckerberg, however. The Facebook founder had planned to spend at least $10 billion on the metaverse in 2021 – andwarnedit wouldn’t be profitable “any time in the near future.”
Another $10 billion: Cost of Apple’s iOS changes to Meta
Meta loses wads of $10 billion like I lose socks in the wash. After blowing that sum on Reality Labs, the company expects to take a similar hit from Apple’sApp Tracking Transparency.
The new feature lets iOS users stop apps from tracking them across the web. That’s bad news for Meta’s business, as it makes ad targeting less effective.
The company said on Wednesday that it will lose around — you guessed it — $10 billion in ad revenue this year as a result of the feature
$29 billion: The drop in Zuck’s wealth
Meta’s stock crash has burned a big hole in Mark Zuckerberg’s wallet. Around $29 billion was wiped off his net worth when the share price collapsed.
But save your tears, my dears. Despite this being among the biggest ever single-day drops in wealth, Zuckerberg remains one of the richest people of all time.
There’s also still life left in Zuckerberg’s baby.
Meta was expecting early losses from the metaverse investment. The company still has vast reserves of cash, a huge built-in user base, the Oculus VR headsets, and a name that gives the illusion of owning the metaverse
It might have been a dreadful week for Meta, but the company is a long way from dead.
Story byThomas Macaulay
Thomas is a senior reporter at TNW. He covers European tech, with a focus on AI, cybersecurity, and government policy.Thomas is a senior reporter at TNW. He covers European tech, with a focus on AI, cybersecurity, and government policy.
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