The Middletown Press (Middletown, CT)
Facebook struggles through worst trading day
Facebook had its worst day on the markets in its history a day after the company revealed that user growth, amid swirling questions about how their information is used, has slowed.
The stock plunged 19 percent in trading Thursday, eradicating well in excess of $120 billion in market value.
The social media company’s financial results, released late Wednesday, fell short of Wall Street expectations as the company continues to grapple with privacy issues. It also warned that revenue would decelerate as it promotes new products
Facebook had 2.23 billion monthly users as of June 30, up 11 percent from a year earlier, but well short of what industry analysts had been expecting.
The results are from the first full quarter following the revelation of the Cambridge Analytica privacy scandal. The company is also contending with European privacy rules that went into effect in May.
The results marked the largest ever loss of value in one day for a U.S.-traded company, after the company’s chief financial officer signaled that the secondquarter miss on revenue — the first miss since 2015 — was part of a longer-term slowdown in growth rates.
The company also said that it would have to spend more to experiment with new business models, as well as invest in solving its problems over data privacy and fake news.