Only a few weeks ago, Facebook shares hit an all-time high, following a remarkable recovery from an eight-month low stock value in the wake of the Cambridge Analytica scandal earlier this year. However, in a surprising turn of events, the tech giant's stock has dropped over 19% today, losing over $120 billion in market value, making it the largest one-day drop of all time, according to Bloomberg.
The previous record was held by Intel, who lost about $91 billion in a single day back in 2000. Although Facebook's current drop in market value clears this amount by a fairly large margin, another interesting fact is that should its stock close below $176.46 today, this would mean that its shares will have wiped out their 2018 gains.
The tech giant was worth $629.6 billion yesterday, but sees itself valued at around $509 billion right now, marking a massive drop of over $120 billion. Facebook's shares closed at $217.50 on Wednesday, but opened at $174.89 today, down by over 19%. At the time of writing, its shares stand at exactly $175.13.
These losses come following the release of the company's Q2 earnings. The figure of 2.23 billion monthly users was up just 1.54%, much slower than 3.14% in Q1. In particular, user growth declined in Europe from the previous quarter, presumably because of the GDPR privacy policies which came into effect last quarter. Aside from the much slower quarter-over-quarter user growth, the firm also did not manage to clear expected revenue earnings.
David Wehner, Facebook's Chief Financial Officer, disclosed today that the social media giant expected its total revenue-growth rates to "continue to decelerate in the second half of 2018". This statement, along with the massive drop in market value, has raised warning signs for the company - particularly with respect to its performance in the upcoming months.
Update: Facebook's shares ended up closing at $176.26 on Thursday - slightly below the figure of $176.46 at the end of last year, as per expectations. This also marks a historic drop of 18.96% in stock value from the closing price on the previous day.