Facebook faced a day of reckoning Thursday as its shares plunged in the biggest one-day drop in stock-market history.
The 19 percent drop vaporized $119 billion of the company’s stock-market value; CEO Mark Zuckerberg saw his net worth fall by roughly $16 billion as a result. It was Facebook’s worst trading day since going public in 2012; the collapse eclipsed Intel’s decline of $91 billion in September 2000, without adjusting for inflation.
The plunge followed Facebook’s warning late Wednesday that its revenue growth will slow down significantly for at least the remainder of the year and that expenses will continue to skyrocket.
In a sign of just how bullish investor expectations were, though, the collapse merely returned Facebook shares to a level last seen in early May. At that point, the stock was still recovering from an earlier battering over its big privacy scandal, in which a political consulting firm with ties to President Donald Trump improperly accessed the data of tens millions of Facebook users.
Now come the big questions: Is this a temporary setback, or the start of a painful new road for the giant social network? And does a similar comeuppance await other high-flying technology behemoths?