Facebook Loses $150B as Privacy, Censorship Scandals Hit Home
The world’s third most valuable company by market capitalization is now in fifth place and falling fast as social media giant, Facebook lost $150-billion dollars in capitalization Wednesday, giving in to earnings tremors involving damaging revelations about selling customers private information and political censorship concerns and possible Congressional hearings about how the company throttles ideologically conservative posts and favors mainstream media sources over independent outlets. Apple, Amazon, Alphabet and Microsoft now rank ahead of facebook for total market capitalization, with Berkshire Hathaway just behind.
Sources say Chief Financial Officer, David Wehner started the cave-in during a Q2 earnings conference call Wednesday where he disclosed that facebook’s privacy and censorship scandals are indeed having broad impacts on the company’s profitability. Wehner predicted pullbacks in facebook earnings for the next several quarters at or near 10%, news that sent shareholders heading for the exits in a $150-billion rush that set records for a single day loss in valuation.
Wehner told investors that facebook expects, “earnings deceleration in the high single digits for the next several quarters.”
In the aftermath, stock prices plunged by as much as 25% during Wednesday trade before settling back just above $160 a share. CEO and founder, Mark Zuckerberg’s personal holdings lost an estimated $16-billion in the shift.
Facebook has come under significant criticism both for their revealed marketing of user data and for admitted algorithm adjustments that are used to limit the reach of conservative news outlets and even individual users and posts dealing with right-wing topics, in a practice known as ‘shadow banning.’