If there’s anything that everyone knows about Meta, it’s that it’s big.
Not just any kind of big, but big-big.
So when Meta’s stock value plunged by around 25% at approximately US$200 billion (approximately S$260 billion) yesterday (3 February), questions about the social media and tech giant were inevitably raised.
Slower Growth
Although it is undeniable that Meta is still a company that has continued to grow on a large scale, with 2.8 billion users using one of their four platforms at least once every day and 3.6 billion users that do so at least once every month, it is also worth noting that their growth has slowed down in recent times.
Facebook, which is owned by Meta, has over two billion users per day. However, in the second half of 2021, it was recorded that the popular social media platform was losing over a million users per day, a statistic that caused investors to be wary.
This marked the first time that the user base of Facebook had decreased in size.
Financially, Meta has also seen a drop in its profits. Although Meta made a turnover of US$33.67 billion for the whole of 2021, a value in line with its forecasts, it only made US$10.3 million in the fourth quarter of 2021, making its sales 8% less than last year.
Additionally, Meta, which also owns platforms such as Whatsapp and Instagram, is also facing stiff competition by other platforms such as TikTok that have gained a large amount of attention worldwide, making it hard for Meta to conquer the social media cyberspace like how it once did.
Apart from Meta itself, CEO Mark Zuckerberg also suffered a personal loss of US$25 billion (approximately S$33 billion) in his own personal holding.
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Meta Reality Labs
Meta Reality Labs, the company’s augmented and virtual reality business, also suffered a net loss of US$10.2 billion and only revenue of US$2.3 billion in 2021.
This was a colossal amount, compared with the US$6.6 billion loss the previous year.
However, Zuckerberg had previously mentioned that that operating profit for 2021 would be reduced by US$10 billion due to the decrease in Meta’s investment towards Meta Reality Labs for 2021.
He also mentioned how Meta Reality Labs “would not be profitable anytime in the near future”.
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Featured Image: Meta