Meta's stock closes down 24.56% at $97.94, its lowest price since 2016, after Mark Zuckerberg reiterated his commitment to spending billions on the metaverse
The immediate importance is not merely a lower share price: Zuckerberg's spending commitment is now being tested against an investor base that has repeatedly repriced Meta after weak operating signals and elevated investment concerns.
First-order effects
Meta's shareholders absorb another sharp valuation decline as Zuckerberg maintains that multibillion-dollar metaverse spending will continue.
Meta faces greater near-term pressure to justify metaverse outlays alongside the operating performance and guidance that had already triggered its February sell-off.
Second-order effects
Other large technology companies pursuing long-horizon projects face a clearer investor benchmark: costly bets are more likely to be judged against near-term results and guidance.
Meta's capital-allocation debate becomes more consequential for investors, because metaverse spending is now central to explaining a decline that has substantially exceeded the broader Nasdaq's drop.
Third-order effects
If this pattern persists, Meta's ability to fund long-duration platform bets will increasingly depend on demonstrating that they can coexist with credible core-business performance.
The episode points to a wider shift in which public-market investors demand tighter evidence of returns from Big Tech's expensive strategic investments, rather than valuing scale alone.
The trend: Investor tolerance for Big Tech's long-horizon spending is tightening as capital-intensive strategic bets are weighed more directly against current results and guidance.
sure laugh at zuckerberg's stock crash but remember that in five years he's gonna own your eyeballs and pause the ads every time you blink https://twitter.com/...
Zuck: we're going to try to innovate Investors: we love innovation Zuck: innovation doesn't happen overnight Investors: we're in this for the long haul Zuck: *tries things* Investors: no, not like that. It's been 9 months, you should give up.
Mad respect for Mark's unique ability to see the future and his bold desire to invest. Many leaders are too timid. But leadership also requires balance and trade offs - and think a few changes would have gone a long way to build trust and get @meta back on the winning track. http…
Lots of talk about how Meta's (Facebook's) decline is not weighing on broader indexes, but perhaps one reason is its weight in S&P 500 has dropped from 2.9% to 1% [Past performance is no guarantee of future results; individual stock shown for illustration purposes] https://twitte…
So Facebook (erm, Meta) is set to open at a market value of ~$267 billion. The last time its market close value was below this level was *Jan. 2016* And Facebook had $18 billion in annual revenue then vs $118 billion now. (data from S&P Global Market Intelligence)
Meta's business has been kneecapped by Apple, growth has stopped in favor of rivals like TikTok, and it's too late to build a phone. Zuck is making an existential bet-the-company move at enormous scale. Most companies would just delude themselves and slowly die.
Some think Facebook is bluffing about stopping news sharing in Canada due to Bill C-18. Maybe. But with the stock tanking, ad revenue down, and the company exiting news agreements elsewhere, is it really going to pay $100M to Bell and the CBC for links? https://twitter.com/...
Meta's market value has collapsed by $520 billion in the past year and is on the brink of getting booted from the ranks of the 20 largest US companies. It trades at a 50% discount to the Nasdaq 100, the steepest ever, via @Subrat_Patnaik https://twitter.com/...
PPS: I have a personal rule against schadenfreude directed at individuals. I get no pleasure in the idea of Mister Zuckerberg feeling sad. But if I were an engineer who gives the least bit of a damn about their favorite media, I would bail.
if mark zuckerberg were a normal CEO with normal business experience, i would think that the cost of the metaverse was a cover-up for corporate fraud on a scale the world has never seen. https://twitter.com/...
i *do* think there are account executives at accenture who have endowed four generations' worth of college funds for their families because of the metaverse, but that's not what i think is really what's going on.
I've never had more respect for a human being than I do for Mark Zuckerberg, right now. People on their hands and knees begging, pleading, crying for him to stop spending $ and he DOESN'T CARE
Whatever schadenfreude one may have at their travails, it's fascinating to see he (and his company) still possess that almost Nietzschean will-to-power quality that orders the entire imperial army in one direction based on a single conviction, as they've done in the past.
sticking to social media, now that Zuck has decided that he won't change course, and everyone is laughing at him, i have no choice but to become a modest bull on the metaverse
Jim Cramer apologizes for encouraging people to buy Meta (Facebook) stock: “I made a mistake here. I was wrong. I trusted this management team. That was ill advised. The hubris here is extraordinary, and I apologize.” https://twitter.com/...
The disaster of Zuckerberg's Metaverse foray really shows that the ftc analysis of Facebook is correct. He can't innovate or build anything organically. He's a monopolist and salesman.
when nintendo made the wii, they faced a challenge of introducing a radically new controller UX into millions of homes. to go along with it they made best in class games utilizing the new features. it went on to become one of the greatest selling game consoles of all time
I believe in #Zuckerberg and his long term vision. It will likely make @Meta the most valuable company on the planet. But he also has to realize that investors dont care about 10 years from now, they care about 6-12 months from now. Long-term vision collides with near-term greed.
Facebook down 20%, yet futures firmly in the green. Mr. Market is saying this is a company problem, not a bigger economic issue apparently. BTW small caps big time strength today says something similar. https://twitter.com/...
The bear case is: Zuckerberg doesn't realise he's meant to be running a money-making machine for the markets and should leave to start something new if he wants to be brave and bold - even if it turns out he's right.
criticizing meta for bold VR play is dumb but i can and will criticize them for their uninspired product vision. “let other people figure out how it's useful” model