Facebook shareholders sue company after stock plunge 'shocked' market

Facebook shareholders sue company after stock plunge 'shocked' market

Facebook shareholders sue company after stock plunge 'shocked' market

The results spelled out disaster for its market value, despite the company heading into Wednesday with a share price of $217.50.

Company shares fell 19 percent Thursday.

For numerous world's richest people, losing $16.8 billion in a day would be a wipeout. Internationally, sales were up 27 percent to $14.6 billion, while net loss fell from $724 million to $494 million.

After-hours declines don't always hold the next day.

Mark Zuckerberg did his best in the earnings call to try to spin this decline as something positive for investors-as if making less money was an active choice the company was pursuing to benefit consumers, rather than a side-effect of everything it's being forced to do in the face of growing public concerns.

Despite the rocky quarter, Facebook shares had hit an all-time high before Wednesday's earnings report and its quarterly revenue was still up 42 percent from this time previous year. Not only that but Facebook has had concerned citizens of the world question its privacy, data collection, and its stance on fake news, and hate speech.

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Shares tumbled as much as 20 per cent in NY on Thursday as sales and user growth disappointed investors.

Facebook said 2.5 billion people were using any of its family of apps each month, including Instagram and WhatsApp. Make no doubt, a 42 percent growth figure is still extremely robust, and that is coupled with an 11 percent year-over-year growth in monthly and daily active users.

Facebook's daily active users for the second quarter of 2018 were effectively flat in the US sequentially, and even declined in Europe compared with Q1 - marking the first time the company has seen such a decline in recent quarters. The Observer revealed that data from millions of Facebook users had been inappropriately passed on to the political consultancy, which wanted to influence voters. "The company earned $1.74 per share, ahead of the $1.72 per share analysts were expecting". Controversies came and went, but nothing stuck.

Facebook's financial reports following the Cambridge Analytica scandal was always going to be an eye-opening experience but, after their announcement on Wednesday, Facebook's global market value took an almighty plummet.

On July 24, 2018, according to the filing, a Facebook board committee "approved an annual pre-tax allowance of $10 million to Mr. Zuckerberg to cover additional costs related to his and his family's personal security".

Follow Facebook's stock price in real time here. Lastly, combine all these with the company's decision to experiment with "Stories" and try to coax advertisers towards the platform at a time when its bases appear uncovered does not sit well for investor sentiment.

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