Mark Zuckerberg experienced a staggering $18 billion hit to his net worth on Thursday as Meta’s CEO comments during the company’s earnings call triggered the sharpest decline in its stock since October 2022.
Despite Meta surpassing revenue and profit expectations, a lower-than-anticipated revenue forecast rattled investors. Zuckerberg reassured them of continued substantial investments in areas like artificial intelligence and the metaverse, even though Meta heavily relies on advertising, which constitutes 98% of its revenue.
During the call, Zuckerberg acknowledged the historical volatility during phases of product expansion and non-monetization, stating, “We’ve historically seen a lot of volatility in our stock during this phase of our product playbook where we’re investing in scaling a new product but aren’t yet monetizing it.”
With approximately 345 million Class A and B shares, Zuckerberg saw the value of his stake plummet by about $18 billion to $152 billion by the close of trading, as the stock fell by $52.12 on Thursday.
The 39-year-old tech entrepreneur, who founded the company in his Harvard dorm room in 2004 and rebranded it from Facebook to Meta in 2021, indicating a shift towards the metaverse, has faced fluctuating fortunes. Meta’s Reality Labs division, responsible for metaverse development, has incurred cumulative losses of $45 billion since 2020.
conclusion
Despite the setbacks, Meta plans to increase capital expenditures to $35 billion to $40 billion this year, signaling a continued commitment to its growth strategy.
Zuckerberg’s net worth has endured ups and downs, mirroring the stock’s volatility. In 2022, his net worth plummeted by approximately $100 billion. However, in early 2023, Meta’s announcement of an “efficiency year” led to a remarkable stock price surge, tripling for the year and boosting Zuckerberg’s net worth.
While Thursday marked a significant loss, it wasn’t the worst day for Zuckerberg’s finances. In early 2022, he faced a nearly $30 billion loss in a single day due to a 26% drop in the company’s stock price following weak earnings and guidance.
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