Things aren’t going good for social media giant Facebook and for it’s for CEO Mark Zuckerberg. After Cambridge Analytica scandal Facebook is in a bad image. Even through Facebook has banned Cambridge Analytica, eliminated third-party data ad targeting and build strong privacy tools for users security. Company still facing daily intense criticism about its content policies and failure to safeguard private data and its changing rules for advertisers.
Facebook has gone through many heartbreaking months in the wake of revelations that data firm Cambridge Analytica improperly gleaned information on 80 million. After Cambridge Analytica scandal Facebook lost nearly about $50 billion in market cap.
And here is a another big loose for Facebook. As of 5:30 pm ET Facebook stock had fallen down to 16%. In this sudden fall of Facebook stock, company loses approximately US$150 billion ($219b) in market capitalization within under two hours. Falling of Facebook stock doesn’t stop there. At around 5:48 pm ET, Facebook stock fall further to $167 billion. This results in bringing Zuckerberg’s net worth down to $63.6 billion.
This dramatic fall of Facebook stock harshly hit the new worth of world’s third richest person. On July 6 Friday Mark Zuckerberg’s net worth jumped to $81.6 billion, making him world third richest person. But on Wednesday 26 July at midday Zuckerberg was the world’s fourth richest person. With his current net worth $63.6 billion, he falls four spots to the eighth richest, according to Forbes Real-Time Rankings.
Before the fall of Facebook stock, Zuckerberg’s net worth was $82.4 billion. Mark Zuckerberg’s net worth has tumbled nearly $16.8 billion in less than two hours. If that holds through Thursday’s close, he will slide to sixth place from third on the Bloomberg Billionaires Index.
It’s an evaporation of wealth so big it would have left the following multi-billionaires without a cent to their name. For many of the world’s richest people, losing $16.8 billion in a day would be a wipeout. For Mark Zuckerberg, it’s just about a fifth of his net worth.
— Peter Daou (@peterdaou) July 25, 2018
For the second quarter, Facebook missed Wall Street analysts’ projections for growth in revenue and daily active users. Despite Wednesday’s dive, however, the Facebook stock are still higher than where it was on March 27, ten days after the Cambridge Analytica news first broke, when it closed at $152.22 and Zuckerberg was worth $61 billion.
Falling of Facebook stock in such a huge manner isn’t a every day thing for Facebook. The last time when Facebook missed revenue estimates was the first quarter of 2015. Cambridge Analytica has turn into a big bad dream for Facebook. The company was bombarded by public criticism over its content policies. After that Facebook suffer from many investigations. The company has even faced hearings before the U.S. Congress and the U.K. Parliament.
If we talk about this year 2018, then in current year it is the second time when Facebook stock has taken such a dramatic downturn. This first happens when the revelation of Cambridge Analytica take place. That time Facebook stock just hit the bottom of the ground. They later recovered and exceeded the value they had before the scandal came to light.
Brent Thill, managing director at Jefferies said “Facebook did not deliver this quarter but we remain bullish about the long-term outlook.”
Thill believes that the Instagram, which Facebook bought for $1 billion in 2012, will help Facebook to get quickly recover from this damage and will guide Facebook to stronger performance in the future.
“Despite facing important challenges, our community and business are off to a strong start in 2018,” said Mark Zuckerberg. “We are taking a broader view of our responsibility and investing to make sure our services are used for good. But we also need to keep building new tools to help people connect, strengthen our communities, and bring the world closer together.” Mark Zuckerberg added.
Facebook said it had 1.47 billion daily active users in June, compared with the 1.48 billion average of analysts estimates compiled by Bloomberg. The company’s biggest market is the U.S. and Canada, at 185 million daily users. If we talk about Europe then there is a declining of 1%, there are 279 million daily users. Overall, average daily users increased by 11% which means to 2.23 billion from 2.2 billion in last quarter.
This increased of 11% in average daily users results in revenue increased of Facebook. Facebook revenue has increased to 4% to $13.2 billion in the quarter. Analysts projected $13.3 billion a 42 per cent year-on-year increase.
Even after many set backs the social network giant still holds one of the world’s most valuable sets of data on what people are interested in, and makes that audience easily available to advertisers. In mobile advertising company still hold there dominance. But how long that it is a big question, future need to address.
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