Mark's face sank as he looked at his company's 4th quarter report.
Shares of Facebook-owned Meta Platform fell 20% on Thursday as the social media company posted a weak forecast for its 4th quarter 2021 report.
The company that came up with the metaverse idea has blamed Apple’s privacy changes and increased consumer competition from competitors like TikTok as the cause of the decline.
According to sources from Meta, Apple's privacy changes to its operating system (OS) have made it difficult for some brands to display ads on Facebook and Instagram platforms, as well as citing macroeconomic issues such as supply chain disruptions.
In addition, it also expects its revenue growth to slow in the coming quarters due to increased competition such as TikTok and YouTube.
Facebook’s 4th quarter report stated a total of 2.91 billion monthly active users, which is almost the same number recorded in the previous quarter.
The decline in Meta shares caused its market value to drop by $ 200 billion with another $ 15 billion missing from its partners such as Twitter Inc, Snap Inc and Pinterest Inc.
Shares of Alphabet Inc, which posted record quarterly sales that exceeded expectations on Tuesday, were also down nearly 2%.
Following the story, Apple has changed its OS and given users the option to prevent apps from tracking their online activity for ads in turn making it difficult for advertisers who rely on data to develop new products and know their markets.
According to Inelligence analyst Debra Aho Williamson, Meta will face new challengers for advertising revenue like TikTok and as it faces the challenges of ongoing ad targeting and measurement from Apple’s iOS changes.
Meanwhile, Meta chief executive officer Mark Zuckerberg said competition for consumers was among the factors influencing the business by citing the TikTok video app and emphasizing Meta's commitment to providing services for young adults.
Meta’s Reality Labs, Meta’s virtual reality business, recorded a net loss of $ 10.2 billion for 2021 compared to $ 6.6 billion the previous year.
