Marking one of the “worst single-day losses in history” was Facebook’s stock dive on Thursday.
Shares fell 19 per cent, eliminating just under $120 billion of shareholder wealth. Founder and CEO Mark Zuckerberg reportedly lost $15 billion in less than a day, per the Facebook shares he owns.
Think you had a bad day?
Facebook's stock fell 19%.
Their market value dropped by $120 billion.
CEO Mark Zuckerberg lost $16 billion. pic.twitter.com/yC6QsxoNN0— CNET (@CNET) July 26, 2018
What does the fall of this tech giant, in all sense of the term, mean for investors?
My Facebook stock just dropped from $180 a share to “it’s complicated.”
— Brian Bates (@brianbatescomic) July 27, 2018
“The 19% plunge reflects the fragility of the tech sector as a whole,” writes Felix Salmon in Axios. “And it’s all the proof you need that tech investors have moved from greed to fear.”
Q2 2018 showed a very slow growing revenue, the “slowest pace in almost three years,” according to Reuters.
“Facebook’s stumble suggests that some of these stocks — as well as the broader market — could be particularly vulnerable if their financial results don’t live up to investor expectations,” writes Matt Phillips in The New York Times.
Looking forward, and what this sharp drop means for the company, some are reminded of what happened just following the Cambridge Analytica disaster, when shares dropped almost 18 per cent in the 10 days after the news broke. By May, it looked as if the company had recovered.
“But given the vast market value of today’s tech giants, and the fact that 20 percent declines in share prices are not unheard-of, the size of the losses shouldn’t be surprising,” writes Phillips, mentioning that even after the drop Facebook is the fifth-largest publicly traded company.
Read More: Facebook sees shares tumble, but does the future look bright?
Headline: “Facebook just had the biggest stock-market wipeout in American history”
Facebook's stock over the last five years, including today's losses: pic.twitter.com/s6GFjdjRuj
— Matt Pearce (@mattdpearce) July 26, 2018
The drop Facebook experienced Thursday is significant, but as Los Angeles Times national correspondent Matt Pearce pointed out on Twitter, it’s all about scale.
