Facebook market value plunges $120 bil

Aug 01, 2018, 06:17
Facebook market value plunges $120 bil

Facebook experienced the largest one-day wipeout in US stock market history yesterday.

Facebook lost Dollars $119 billion in market value as the share price plunged - reportedly the largest single-day loss for any public company in history.

So far, three class-action suits have been filed by shareholders claiming that Facebook made false and misleading statements to investors including lack of disclosure around monetization associated with Instagram Stories.

Facebook's decline significantly outpaced the $91 billion that Intel lost in September of 2000, during the original dot-com bust.

Shareholders often sue companies in the United States after unexpected stock price declines, especially if the loss of wealth is large.

It's been a rough year for Facebook and its investors.

A DE judge says he wants to hear from Facebook founder Mark Zuckerberg before ruling on attorney fees in a shareholder suit challenging a proposed stock reclassification. Now, it is investing heavily on fixing those problems.

Facebook is also battling several other suits relating to the handling of user data in the Cambridge Analytica case.

More worrisome was the number of daily active users, which grew by just 22 million - the lowest such number since at least 2011. Last week had not been good for one of the most popular social media company, Facebook as it released biggest drop in its share prices in one single session.

Facebook shares fell as much as 23 percent in after-hours trading when Facebook reported its second-quarter earnings.

Zuckerberg had been tied with Warren Buffett as the world's fourth-richest person, but the Berkshire Hathaway chairman's current $US83 billion ($A112 billion) fortune tops Zuckerberg's $US66 billion ($A89 billion), Forbes magazine said.

Currently, its stocks are at US$174.89 down 0.78 per cent.

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