Facebook market value plunges $119 billion

Facebook shares sink 8% as Q2 revenue and user growth misses analyst estimates

For numerous world's richest people, losing $16.8 billion in a day would be a wipeout. If that holds through Thursday's close, he will slide to sixth place from third on the Bloomberg Billionaires Index.

Both the slower growth forecast and heavier spending reflect problems largely of Facebook's own making.

And for those hoping for a swift bounce back, the company told Wall Street the numbers won't get any better this year.

"We continue to focus our product impact on putting privacy first, and that's going to have some impact on revenue growth", said Facebook chief financial officer David Wehner on the earnings call. "Earnings per share were $5.07, smashing analysts" estimations of $2.50. We're starting to see that this quarter.

For Facebook, financial stumbles are rare.

That could be down to the drop being a one-off, potentially following the Cambridge Analytica data sharing scandal, or even the sharing of private posts belonging to some 14 million Facebook users, rather than a downward spiral for Facebook.

Facebook has also faced public image problems because of the way Russian Federation used the site to try to influence the 2016 USA presidential election. "The core Facebook platform is declining", said Brian Wieser, an analyst at Pivotal Research Group.

In the second quarter, Facebook lost roughly 1 million monthly users, and 3 million daily users in Europe.

Facebook's shares collapsed by 18% on Thursday when the stock market opened in NY, a day after the Silicon Valley company revealed that 3 million users in Europe have abandoned the social network since the Observer revealed the Cambridge Analytica breach of 87m Facebook profiles and the introduction of strict European Union data protection legislation.

Factors contributing to Facebook's slowing sales growth include currency-exchange rates, compared with "the tailwinds we have experienced over the last several quarters", Wehner said. Analysts were expecting $2.1 billion, according to Thomson Reuters. And investors responded Thursday by hammering the stock of Facebook, one of the world's most valuable companies.

Nearly all of Facebook's revenue - $13 billion of the total $13.2 billion - came from online advertising, a sector dominated by the California social network along with Silicon Valley rival Google. The report also predicted far weaker growth in the future than had been expected.

Much ground has been lost in the short span of 24 hours - a fall from which Facebook will have to work hard to recover. Worth noting: It costs nowhere near that much to protect the CEO of the most valuable company in the world nor the tech CEO who's also the wealthiest person in the world. "And it reflects that many people use more than one of our services", he said. The company doesn't break out Instagram's revenue.

Facebook disclosed in a security filing it will pay the $10 million in cash, which surpasses the $7.3 million the company paid for Zuckerberg's personal security detail in 2017. The company said headcount was 30,275 as of June 30 - an increase of 47 percent year over year. $130 billion had been wiped off of Facebook's market cap as a result of the stock's plunge. That surprised investors because of the belief that the new laws wouldn't hurt revenue.

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