At the close of trading in the US stock market on Wednesday, tech giant Meta, owner of social network Facebook, lost more than 20% of its value, dropping to $323 a share. At the same time earnings per share amounted to $3.67 against analysts' expectations of $3.84 per share.
Meanwhile, Meta Platforms' shares traded on the Frankfurt Stock Exchange fell by almost 19%. The tech giant's drop during Wednesday's trading session sent the company's market value down by $200bn.
The main reason for the stock's plunge was the corporation's weak earnings amid a Facebook report that the number of daily active users dropped for the first time ever. Thus, the number fell from 1.929bn in the three months to the end of December, compared with 1.930bn in the previous quarter. At the same time, market analysts expected the number to grow to 1.95bn.
Facebook's monthly active users remained flat from the third quarter of 2021 to the fourth at 2.9 billion.
According to Meta's profit and loss report, the tech giant's revenue for the last three months of 2021 was around $10.3bn.
The company's revenue forecast for the next quarter was also an important downward factor, as it was weaker than analysts and investors had expected. The company's officials are expecting revenues of between $27 and $29 billion, compared with the economists' preliminary scenario of $30.15 billion.
Speaking to investors, Mark Zuckerberg, CEO of Meta Platforms, admitted that the corporation is under pressure from growing competition for advertising revenue and changes in privacy terms from Apple. The American entrepreneur cited popular social networking apps, primarily TikTok, as Facebook's main competitors.
Zuckerberg said it was important to develop Instagram's short video Reels feature in the long term to boost the number of its daily active users.
