A 19% loss in Facebook’s stock has chopped $119 billion – or £91 billion – off its market value.
It was the company’s worst trading day since going public in 2012, and among the biggest one-day losses of market value in US stock market history.
Chief executive Mark Zuckerberg’s fortune took a more than $15 billion hit, or around £10 billion.
Facebook’s share price plummeted on Thursday as investors freaked at the social network’s admission that it had lost 3 million users in Europe.
Wall Street fears Facebook’s model could be under threat after a year dominated by efforts to head off concerns over privacy and its role in global news flow.
Shares in the company fell as trading opened following losses in after-hours markets after the social network warned investors that growth would continue to slow.
Facebook’s monthly active user count was 2.23 billion, slightly behind the 2.25 billion forecast by analysts.
Although Facebook’s monthly active users were up 11% year-on-year, growth has fallen flat in the US, while the user count has fallen in Europe. Both are key advertising markets.
Europe’s fall was partly down to the roll-out of data protection rules, dubbed GDPR, the company told investors.
Revenue estimates also fell short, reaching $13.3bn, as the company continues to deal with fake news and privacy issues in the wake of the Cambridge Analytica scandal by investing in improved safety and security controls.
“As I’ve said on past calls, we’re investing so much in security that it will significantly impact our profitability,” CEO Mark Zuckerberg said in an earnings call. “We’re starting to see that this quarter.”
Facebook warned investors that it expected revenue gains to slow down because of users utilising options to limit advertising on the social network.
“Our total revenue growth rate decelerated approximately seven percentage points in Q2 compared to Q1,” warned chief financial officer David Wehner.
“Our total revenue growth rates will continue to decelerate in the second half of 2018, and we expect our revenue growth rates to decline by high single-digit percentages from prior quarters sequentially in both Q3 and Q4.”
Some analysts have also put the fall down to social media reaching its peak.
“Teens are abandoning – or just not joining the site – as ‘oldies’ migrate there,” said Richard Holway, chairman at UK tech analyst house TechMarketView.
“Teens have been moving to Instagram, WhatsApp and Messenger. But now it looks as if overall usage is stalling.
“Indeed daily and monthly users in Europe actually fell for the first time ever in Q2. GDPR undoubtedly played a part here.”
One area Facebook had reason to celebrate was in its other platforms, especially Instagram, which reached a milestone of one billion active years this quarter.
“We believe Instagram has been able to use Facebook’s infrastructure to grow more than twice as quickly as it would have on its own,” Mr Zuckerberg said.
“I’m really excited about video too, and this quarter we launched IGTV.
“People are watching less TV but more video, but most video is not yet optimised for mobile. IGTV will help solve that problem.”
The initial fall was the biggest in corporate history, topping Intel’s $100bn decline on a single day in 2000.
With reporting by the Press Association.
