Shares of Facebook’s parent company Meta went into a nosedive after the markets closed on Wednesday, following an underwhelming quarterly report, the first since CEO Mark Zuckerberg announced the name change.
The stock stood strong at $323 a share when the markets closed at 4pm EST, but collapsed to $249 just half an hour later, for a loss of almost 23%. In just the first 11 minutes of after-hours trading, $16 billion in Meta’s market cap had been wiped out.
What triggered the sell-off was Meta’s quarterly report showing lower revenue, earnings per share, and the numbers of daily and monthly active users than expected by investors.
Whereas investors expected around $30.15 billion, Facebook’s figures showed $27-$29 billion, CNBC reported, citing a Refinitiv survey of market analysts. According to the same source, earnings per share came in at $3.67, short of the expected $3.84.
The number of daily active users (DAU) stood at 1.93 billion, less than the expected 1.95 billion, while the monthly active users (MAU) also undershot the 2.95 expectation, ending up at 2.91 billion, according to Street Account.
This is the first quarterly report since Zuckerberg announced his social media behemoth would be changing its name to Meta, to better represent its focus on the upcoming metaverse and encompass the existing Facebook, Instagram, and WhatsApp brands.