Meta Stock In Freefall as Brutal Week Continues

Meta stocks plummeted 22% on Thursday, at time of writing, as the company faced down a variety of challenges this week.

Shares began their most recent plunge following a 4% decline in annual revenue reported Wednesday, marking the tech giant’s second straight quarter of decline, The Wall Street Journal reported Thursday. The company failed to impress investors with its virtual reality program known as the metaverse, ad revenue declined as inflation, competition from TikTok and new privacy rules on Apple devices kicked in and the company was hit with a nearly $25 million fine Wednesday for violating campaign finance laws.

The Wednesday fine, levied by a Washington state judge, is the largest campaign finance penalty ever issued, and follows a judge’s finding that the company had failed to produce advertising records for public inspection in a timely fashion, racking up 822 intentional violations of the state’s campaign finance disclosure laws in the process, Axios reported.

Meta lost $3.7 billion on its Reality Labs division over the past year, and generated just $289 million in revenue, half the previous year’s, but nevertheless plans to spend more going forward, Business Insider reported. These expenses have been criticized by investors who questioned spending so much money on a virtual reality that did not appear particularly advanced, prompting an Oct. 24 letter by tech-focused investment firm Altimeter Capital requesting the company limit spending on Reality Labs and other metaverse projects to $5 billion per year, according to Business Insider.

Meta bought back $6.5 billion as free cash flow dropped off the face of the earth. I did not see this coming. I trusted this management and that was ill-advised

— Jim Cramer (@jimcramer) October 27, 2022

“Captain Zuckerberg continues to steer the Meta ship towards an unknown path called the Metaverse and is determined to splurge billions and billions of dollars in an endeavor to reinvent itself,” Neil Campling, head of technology, media and telecommunications research at Swiss banking group Mirabaud, told Business Insider.

Zuckerberg, however, views the metaverse as a long-term investment, and hopes investors will show patience, Bloomberg reported. The request echoed calls for patience when investors were skittish about WhatsApp, Instagram and Messenger in 2015, with the key difference being that those apps each had hundreds of millions of users.

In contrast, Horizon Worlds has less than 200,000 monthly active users, the WSJ reported. The company has slashed their target of 500,000 monthly active users by the end of the year to just 280,00.

“I think we’re going to resolve each of these things over different periods of time,” Zuckerberg said on a Wednesday earnings call with investors, according to Bloomberg. “And I appreciate the patience and I think that those who are patient and invest with us will end up being rewarded.”

Year to date, Meta stocks were down over 70% at time of writing, according to Google Finance.

Meta did not immediately respond to the Daily Caller News Foundation’s request for comment.

_{Content created by The Daily Caller News Foundation is available without charge to any eligible news publisher that can provide a large audience. For licensing opportunities of our original content, please contact licensing@dailycallernewsfoundation.org.}