Over $230 billion! Meta set a new record for the largest single-day market capitalization evaporation of us stocks

On Thursday, local time in the United States, Internet platform company Meta Platforms closed down 26.39%, which also means that the company's market value evaporated nearly $237 billion in just one day, which also broke the record of Apple's market value evaporation of $180 billion in a single day in September 2020.

Poor earnings led to a market sell-off

The main reason for the company's sharp decline was the financial report released after hours on Wednesday, not only the profit data was weaker than expected, but the first quarter revenue guidance also surprised the market.

According to the company's disclosure, in the fourth quarter of 2021, it achieved revenue of $33.671 billion and net profit of $10.285 billion, which is also the first time that the company has experienced a year-on-year decline in profit (-8%) since the second fiscal quarter of 2019. The company also disclosed that the revenue guidance for the first quarter of this year was $27-29 billion, corresponding to a growth rate of 3%-11%, far worse than analysts' expectations of $30.15 billion.

META also revealed in the earnings report that consumers' shift to streaming media businesses with lower currency conversion rates, changes in Apple's system rules, and changes in regulatory winds will continue to have a negative impact on the targeted advertising business. In addition, inflation and supply chain issues in the real economy can also affect advertisers' budgets, and even exchange rates will become headwinds to performance.

Meta shareholders are very injured and their peers have also been affected

Meta's outrage also reflects the risks hidden by the Internet giants against the backdrop of ultra-high valuations: Meta's 20% decline today triggered a loss of wealth that is already higher than the market capitalization of 452 companies in the S&P 500 constituents.

It is worth mentioning that this is not the first time that Meta has seen such a large decline. As early as July 2018, affected by the slowdown in user growth, Facebook's stock price fell 19%, and the corresponding market value evaporated to $120 billion. At that time, this figure also set a record for the largest one-day market capitalization evaporation of the US stock market, and it was not broken until 2020.

It is worth mentioning that The big fall in Meta on Thursday also had an impact on a number of Wall Street funds. According to Wells Fargo's statistics as of the end of last year, among the fundamental funds and mutual funds with a total asset management scale of $1 trillion, Meta is one of the few Internet heavy targets of such funds. It also means that these funds not only have to withstand The impact of Thursday's plunge, but also miss out on opportunities for similar tech giants such as Microsoft and Apple to continue to grow in profitability.

Dragged down by the meta-plunge, a number of Internet companies relying on digital advertising business have weakened simultaneously. As of Thursday's close, Serabu was down 23.60 percent, Pinterest was down 10.32 percent and Twitter was down 5.56 percent.