Shift From Facebook to Meta Cost Zuckerberg $30B Slash in Net Worth, Stock Plummets 26% in Single Day

Meta Platforms, formerly known as Facebook, had the worst trading day in its history on Thursday.

The company's shares closed down 26.39% on Thursday (February 03), wiping out nearly $240 billion of shareholders' worth.

The company released a poor earnings report on Wednesday after market hours. The report showed no monthly growth in Facebook users last quarter company to the prior period, which raised concerns about the company's growth.

The worse-than-expected profit decline and revelation of immense money lost in its shift to the metaverse were equally terrifying to shareholders.

Because of its giant existence, the amount that Meta lost is higher than the entire market cap of companies like Oracle, Cisco, and nearly as much as the market cap of Disney.

Mark Zuckerberg, founder of Facebook, and chairman, CEO, and controlling shareholder of now-Meta owns 14.2% of the company's total outstanding shares. Because of the plummet, his net worth got slashed down $31 Billion.

Zuckerberg is no longer on the list of the top 10 richest Billionaires. According to Forbes' Real-Time Billionaires list, Zuckerberg now has a net worth of $84.8B and is 12th on the list. This makes him "poorer" than Mukesh Ambani, Bill Gates, and Warren Buffett, the Oracle of Omaha who has donated a big chunk of his wealth away in charity.

Meta's co-founders are also facing unprecedented declines in their personal fortunes. Dustin Moskovitz, the world's 79th-richest person with a net worth of $21.2 billion as of Wednesday, has lost about $3 billion, while Eduardo Saverin, worth $17.5 billion, is down more than $4 billion.

When Facebook announced its plans for Meta, it was already in the middle of regulatory fights. This incident has further added to the company's challenges regarding justifying its strategic shift to the metaverse.

These are the 6 reasons the company Meta is in trouble, according to The New York Times (elaborated for clarity):

1) User growth has hit a ceiling.
2) Apple’s changes are limiting Meta since the former company now allows its users to opt-out of apps tracking their behavior.
3) Google is stealing online advertising share.
4) TikTok is more trendy among users, and Instagram's effort to clone the same effect on Instagram Reels hasn't been effective.
5) Meta is spending on its primary focus- the Metaverse, and like most massive, speculative investments, the project is at its early, unprofitable days.
6) Facebook has been continuously strangled by regulators in the US and elsewhere.