Get all your news in one place.
100’s of premium titles.
One app.
Start reading
Bloomberg
Bloomberg
Thyagaraju Adinarayan and Jan-Patrick Barnert

Meta Erases $251 Billion in Value, Biggest Wipeout in History

Meta Platforms Inc.’s one-day crash now ranks as the worst in stock-market history.

The Facebook parent plunged 26% Thursday on the back of woeful earnings results, and erased about $251.3 billion in market value. That’s the biggest wipeout in market value for any U.S. company ever. 

And while the stock could certainly bounce back in coming days, especially given the volatility that’s gripped the technology sector this year, the mood on Wall Street has turned decidedly bleak on the long-time market darling. 

Analysts pointing to the stiff competition that Meta now faces from rivals and to the fact that revenue was below expectations as causes for concern. Michael Nathanson, an analyst at brokerage Moffett Nathanson, titled his note “Facebook: The Beginning of the End?”

“These cuts run deep,” he wrote. The results were “a headline grabber and not in a good way.”

The sheer size of Facebook’s collapse illustrates just how tech companies have ballooned in size to become behemoths with unprecedented market power, and the drama that can ensue when they stumble.

“Lots of U.S. megacaps are priced as growth stocks. They may suffer more in a rising yield environment, especially if growth becomes more questionable,” said Frederic Rollin, senior investment advisor at Pictet Asset Management.

 

Meta Slumps With Targets Slashed on TikTok Threat: Street Wrap

Meta “finds itself in the middle of a perfect storm,” wrote Youssef Squali, an analyst at Truist Securities. 

Twitter Inc., Snap Inc. and Pinterest Inc. all closed lower Thursday and dragged the Nasdaq Index down 4.2%, its worst selloff since September 2020. Meta shares rose 1.4% after hours.

Meta’s market cap as of Wednesday’s close stood at roughly $900 billion. The company makes up one of the original Faang cohort of tech megacaps, including Google’s parent Alphabet Inc., Amazon.com Inc. and Apple Inc. 

 

It’s not the first time Meta shares have dropped dramatically. The stock plunged 19% in July 2018 on a slowdown in user growth, translating to a about $120 billion decline in market capitalization. At the time, it set the record for the largest-ever loss of value in one day for a U.S. traded company.

“We’re hopeful the company kitchen-sinked the outlook,” said Shyam Patil, an analyst at Susquehanna Financial Group. 

©2022 Bloomberg L.P.

Sign up to read this article
Read news from 100’s of titles, curated specifically for you.
Already a member? Sign in here
Related Stories
Top stories on inkl right now
One subscription that gives you access to news from hundreds of sites
Already a member? Sign in here
Our Picks
Fourteen days free
Download the app
One app. One membership.
100+ trusted global sources.