Published: Wed, August 01, 2018
Money | By Wilma Wheeler

Facebook loses a record $120 billion in a single day

Facebook loses a record $120 billion in a single day

This wiped as much as $150 billion from the company's market value.

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.

The drop translates to a US$119.4 billion ($176 billion) decline in market capitalisation, the largest-ever loss of value in one day for a U.S. traded company.

Facebook's decline significantly outpaced the $91 billion that Intel lost in September of 2000, during the original dot-com bust. "It's the F in FAANG, but what's to say that, 10 years from now, Facebook isn't the next Myspace and something else has taken its place?"

This is not the first time the social media company has faced lawsuits this year with the company dealing with the aftermath of the Cambridge Analytica scandal.

Facebook founder, chairman and CEO Mark Zuckerberg, who has started feeling the pressure with lawsuits being filed against him, is also being asked to quit the top post by shareholders.

Facebook loses $120 billion in value in a day

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

Facebook's shares were worth $629.6 billion Wednesday, but, by Thursday, were worth only $506.2, according to Tech Crunch.

Facebook shares fell another 0.8 percent on Friday, closing at $174.89 on the Nasdaq.

The revelation of a massive data leak in March was another factor that hurt the United States social networking giant. Its daily active users and earnings per share also took a hit. 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.

These quotes and average results from its second quarter caused Facebook's stocks to drop a whopping 19 per cent overnight.

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