Meta revealed a second straight quarter of declining sales on October 26. The Company is currently battling with generally reduced digital advertising expenses. Also, the growing competition from the TikTok platform has been a serious concern.
In addition, the base of Meta’s business has continued to be affected by a privacy upgrade on Apple IOS. The update restricted marketers’ chance to target audiences in various ways.
Meta’s Stock Price Fluctuations
The company’s stock value was reduced by over 60% within the first nine months of 2022. Meta’s value depreciation is twice as much as the loss suffered by tech-heavy NASDAQ. Also, the company’s revenue had continued to decline every year, the earnings report revealed.
The announcement of the decline in value caused Meta’s stock to fall more than 10% in after-hours trading. Meta’s platforms, like Facebook, Instagram, Whatsapp, and messenger, have 2.9 billion daily active users. This number represents a 4% increase in daily users.
The company encountered several difficulties this year, especially when the chief operating officer left the organization. Sheryl Sandberg left the company to join another firm. Also, the company’s multibillion-dollar investment in the metaverse did not yield the expected profit.
The ongoing revenue loss is recent in the company’s number of problems. However, efforts geared towards chatting with the firm have proved abortive, ABC news reported.
Investor’s Reactions to the Recent Meat Value Decline
Meta’s investors have recently criticized the firm for making a massive investment in its metaverse. The criticisms resulted from Metaverse’s inability to yield the appropriate result as expected. However, the company is tersely working to bridge the gap.
Brad Gerstner, one of the investors, wrote a letter to the company this week concerning the decline. His company, Altimeter Capital, acquired Meta shares over hundreds of millions of dollars. He questioned the company for its uncalculated strategy and unrealistic results.
Gerstner said, “Meta has ventured into the space of –too many individual, too many policies and thoughts, too many uprisings” The lack of proper concentration and qualifications hinder growth. Also, technology cannot survive the such environment, he said.
He also urged Meta to spend less than $5 billion annually on the metaverse project. Also, the cost of maintaining employees should be reduced by 20%. Recently, Meta needs to regain its image, pride, and vitality.
This report was presented after Microsoft and Goggle-alphabet announced disappointment with their revenue. Microsoft’s revenue increased by 6% in five years, while Alphabet’s growth was tiny. Microsoft also planned to sack 1,000 employees, which will reduce administrative costs.