How he went so bad for Facebook so quickly

The last few hours have not been good for Facebook. The social media network reported in Q2 2018 earnings that revenues rose 42 percent to $ 13.2 billion, but that was still below Wall Street's estimate of $ 13.3 billion. What ensued is nothing less than a blood bath induced by panic. The company's share has fallen by more than 20%, which means that CEO Mark Zuckerberg lost up to $ 16.8 billion immediately after the earnings call. Now, Facebook's market value has slipped from $ 119 billion to $ 510 billion, while the stock price has dropped 19%. According to financial research firm FactSet, Facebook's market capitalization was nearly $ 630 billion, before the vertiginous fall.

This may be a slightly delayed reaction to the controversies surrounding Facebook in recent months. Scandals hurt the company. There is the combined impact of the scandal on the privacy of Cambridge Analytica users, the political complication that occurred after the publication of the details of Russian involvement in the elections and visits that the company's CEO Mark Zuckerberg performed at congressional hearings this year. At the same time, the social network is unable to curb the spread of false news and misinformation on its platform, but to be honest, WhatsApp and Twitter are also struggling with the fake news debate. It also means that Facebook spends a lot more on resources, to clean up shared content on the platform.

Although there has been a backlash from the user after Facebook's controversies, the Facebook-owned photo sharing network has exceeded one billion users last month. On the other side of the coin is WhatsApp, who has also faced many criticisms for being unable to curb the spread of fake messages of incitement to violence. In fact, WhatsApp is currently at odds with the Indian government, the latter demanding stronger measures to control the spread of misinformation via the instant messaging application before the general election next year.
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In the current state of affairs, Facebook has become the first company in the US stock market history to lose $ 100 billion in market value in a single day. The biggest loss recorded so far was that of Intel, when the tech company lost $ 90.74 billion in market value in September 2000, coinciding with the bursting of the dotcom bubble .
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However, controversies are not the only problem. In the coming quarters, Facebook will definitely feel the impact of slower growth – after all, the social network does not have much more space to grow. There are currently 2.23 billion people using Facebook right now, and there really is not a lot of new listings on the horizon.

Facebook has always used the news feed to make money, with targeted ads. The more ads on the timeline, the more you knew Facebook was making money – but too many ads, and people would turn away. Now the company has to look at other companies including Messenger and Virtual Reality, the numbers and the future of both being less than certain at this stage.

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