Facebook has been on a long and rocky fall from grace of late, and it’s no one’s fault but their own.
The enormous social media company’s troubles first began as evidence emerged of their horrid data collection practices, and the cattle-like treatment of their users. Then came a staunch wave of conservative censorship that damaged the platform’s integrity beyond repair.
But now, as Facebook’s parent company gambles on the “Metaverse”, it seems as though Mark Zuckerberg’s online behemoth is sputtering out.
Meta Platforms Inc. shareholders are paying dearly for its spending on the metaverse: The Facebook parent’s market value has collapsed by a whopping $677 billion this year, forcing it out from the ranks of the world’s 20 largest companies.
The punishment shows no signs of easing anytime soon. Meta’s stock is down as much as 25% after it spooked investors with ballooning costs to fund its version of virtual reality and a decline in revenue.
Meta was the sixth biggest US company by market capitalization at the start of the year, flirting with a $1 trillion market value. Fast forward 10 months and the stock will be worth about $258 billion, ranking it 26th. Its market value is now smaller than companies including Chevron Corp., Eli Lilly & Co. and Procter & Gamble Co.
The rout appeared to ping the radar of the nation’s largest financial institutions.
Once a Wall Street darling, Meta is gradually losing favor with brokerages. At least three investment banks — Morgan Stanley, Cowen and KeyBanc Capital Markets — cut their rating on the stock after the company gave a disappointing quarterly revenue outlook.
The “Metaverse” concept has largely been seen as a boondoggle of sorts, and it appears as though investors are growing impatient.