Facebook Parent Company Meta Is In For a Turbulent 2022
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Meta’s stock price is currently in freefall after Wednesday night’s earnings revealed some notable, negative firsts for the social media giant. The company reported that Facebook lost roughly one million daily active users, the largest user loss the platform has seen in a single quarter. User growth on its other platforms, Instagram and WhatsApp, slowed as well. Meta reported only adding around 10 million users across its entire app library in the same timespan.
Reality Labs, the division focused on the Metaverse future Meta CEO Mark Zuckerberg continues to heavily promote, lost $10 billion. The company is projecting an additional $10 billion dip in overall revenue as the implementation of Apple’s App Tracking Transparency policy threatens to disrupt Meta’s targeted advertising revenue stream.
According to CFO Dave Wehner, Meta doesn’t have a precise measurement of how ATT, which requires apps on the majority of Apple platforms to allow users to opt-out of having their activity tracked across multiple apps, will impact its bottom line. “If you aggregate the changes that we’re seeing on iOS, that’s the order of magnitude. We can’t be precise on this. It’s an estimate,” Wehner said.
The drop in users and slashed 2022 projections caused Meta’s stock price to drop by more than 20%, shaving roughly $200 billion off its market cap overnight. That figure jumped to $250 billion by the end of Thursday, setting a new record for one-day value loss.
This isn’t the news Meta and its investors needed as it heads into what is likely to be another turbulent year where its reputation will continue to take hits. Facebook, like other social media platforms, is still woefully behind on combating radicalization and hate speech within its ecosystem, and looming antitrust litigation from the Federal Trade Commission could force Meta to divest from Instagram and WhatsApp.