Facebook lost users for the first time in history. The value of the Meta was down by as much as USD 200 billion

It cannot be denied that it is second to none in terms of the number of users, revenues generated or the valuation of the entire conglomerate (currently existing under the name Meta Platforms). The decrease in the number of people using the platform every day will not hurt Facebook badly (or at all), but it is extremely symbolic, because it is the first time in history.

Investors reacted very rapidly to this information. The company’s shares in trading before Thursday’s session on the US stock exchange fell by as much as 20 percent, which resulted in a huge drop in the market value of the entire conglomerate. If this price persists after 3:30 pm during the regular trading session, the Meta will no longer be worth $ 900 billion. (as on Wednesday before the announcement of the results), and almost $ 200 billion. less.

Latest Meta Financial Results

A report that Meta at night summarizes financial results and covers two periods – the last quarter of 2021 and the entire year 2021. The numbers – at least on paper – are impressive. The conglomerate made billions of dollars again.

In all of 2021, Meta recorded $ 117.9 billion. revenues (a year ago it was $ 86 billion), which came almost entirely from advertising ($ 114.9 billion). The company’s total income is, in turn, a trifle of $ 46.8 billion. (compared to USD 32.7 billion).

However, it is also worth noting that Reality Labs, the division responsible for creating products from the virtual and augmented reality segment, recorded a loss of $ 10.2 billion. Reality Labs is losing for another year in a row. In 2019, this business generated over $ 4.5 billion for Facebook. losses, and in 2020 it was already over $ 6.6 billion. So in 2021, the loss was even greater.

Purely Meta earned nearly $ 39.4 billion throughout 2021., which is over 10 billion more than the year before. In the fourth year 2021 alone, it was USD 10.3 billion, which is less than in the corresponding period a year earlier (USD 11.2 billion), which is, however, quite alarming.

Facebook is losing users for the first time ever

However, this was not what upset Meta’s investors. From the results, we can read that the largest business of the conglomerate, i.e. Facebook, began to lose users. The loss is admittedly small.

In the fourth quarter of 2021, Facebook had an average of 1.929 billion daily users. It is still a gigantic community that makes the website the absolute leader among all social networks. The problem is that in the third quarter of 2021, there were 1.93 billion users, i.e. a million more. So far, Facebook in this category has only recorded increases. The current decrease in the number of users is the first such case in the history of the platform, that is for 18 years (the portal was established in February 2004 under the name TheFacebook).

As he notes, Facebook users are mainly fleeing from Latin America and Africa. Other American media note that these are mainly young users for whom the world’s largest social networking site has nothing new to offer. In the long term, the outflow of users may also be the result of several large ones.

Facebook also failed to meet the expectations of stock market investors in this aspect. How, analysts predicted that the number of Facebook users will reach 1.95 billion in the last quarter of 2021. The total number of users of all Meta applications (including Facebook, Messenger, Instagram, WhatsApp) was 2.91 billion (in the same period), compared to 2.95 billion forecast by analysts.

This does not mean, however, that the largest social networking site in the world is sinking, as some of the platform’s opponents may claim. However, this is probably a signal that Facebook is already a saturated place that is not able to attract new people in such large numbers. The increases will probably continue, but they will not be as high as in previous years.

Facebook has a problem with Apple’s policy

It’s also worth mentioning that Facebook is currently struggling with the reduced number of personalized ads reaching users. These are the consequences of the App Tracking Transparency function introduced in iOS by Apple in 2021, which allows iPhone owners to block the option of tracking user activity by third-party applications.

Facebook’s advertising business is largely based on providing advertisements that are best matched to the preferences of users, so it is not surprising that the platform’s authorities are openly criticizing Apple. Mark Zuckerberg has now admitted Facebook’s advertising infrastructure so that the social network can continue to deliver “high-quality personalized ads” to iOS smartphone users.