Facebook loses $130 billion in market value after weak revenue forecast

Photo by Bloomberg

Mark Zuckerberg speaking at the Viva Technology conference in Paris, France, on Thursday, May 24, 2018.

Facebook warned its investors of weakening revenue for the second half of the year Wednesday, sending shares plunging more than 20 percent.

The latest guidance followed a revenue miss for the company and a report of lower daily active user counts in Europe. Chief Financial Officer David Wehner said shareholders can expect “revenue growth rates to decline by high single-digit percentages from prior quarters” for the third and fourth quarter.

“We plan to grow and promote certain engaging experiences like stories that currently have lower levels of monetization, and we are also giving people who use our services more choices around data privacy which may have an impact on our revenue growth,” said Wehner. He also said currency fluctuations would hurt the stock in the second half of the year, after helping it for the last several quarters.

Facebook has made several privacy policy changes in recent months in the wake of the company’s Cambridge Analytica privacy scandal and recently enacted General Data Protection Regulation (GDPR), a set of rules that give users more control over their online data.

At the lowest after-hours price below $170, Facebook would open Thursday with a market value below $500 billion. Given its market cap at the close Wednesday was $629.8 billion, that means it’s poised to lose more than $130 billion in market value.