"Facebook, its reputation and the people who work in it have been pretty battered over the past year," said Nell Minow, vice chair of the corporate governance consulting firm ValueEdge Advisors. "And so this is just one more mud pie in the face."
If a day later you're still puzzling over what exactly US$119b looks like, we feel you. First, some context.
The money Facebook lost in one day amounts to more than the enter market capitalizations of some of America's largest companies. Or another way to look at it, it's more than the GDP of entire nations.
For comparison's sake, here's what some of the biggest corporate names are worth (according to Google stocks, premarket value Saturday):
Facebook's loss: US$119b
Costco: US$96.3b
UPS: US$95.82b
Bristol-Myers Squibb: US$93.42b
Lockheed Martin: US$91.7b
Goldman Sachs: US$89.4b
American Express: US$87.4b
21st Century Fox: US$83.46b
Time Warner: US$77.27b
Kraft Heinz: US$73.53b
Starbucks: US$71.24b
FedEx: US$63.24b
And when compared to the GDPs of entire countries (according to the World Bank):
Facebook's loss: US$119b
Morocco: US$109b
Ecuador: US$103b
Slovak Republic: US$95.77b
Sri Lanka: US$87b
Ethiopia: US$80.56b
Dominican Republic: US$75.9b
Guatemala: US$75.6b
Kenya: US$74.9b
Experts said part of Facebook's response requires triage within the company's own ranks. In the world of corporate governance, Minow said, companies are encouraged to align the interests of their employees, executives and shareholders, including by having employees own stock.
"So the downside of that, quite literally, is that when something like this happens, they start panicking about their net worth rather than paying attention to what's going on at the office," she said.
Any efforts to revamp corporate culture stem from the top, said Jeffrey Sonnenfeld, senior associate dean for leadership studies at the Yale School of Management. Companies whose leaders grow increasingly isolated often fall into the trap that "on earth, one person is truly indispensable, and that's themselves," Sonnenfeld said.
Plus, Sonnenfeld said, Facebook risks losing a young, talented and mobile workforce that may not be unflinchingly loyal to the company brand.
"You can't pound your first and command a culture - a lot of CEOs are naive about that," he said. "If doesn't matter what kind of shirts you wear, the architecture you use in the office. It's what you actually do. A culture responds from what you do."
The added scrutiny put on Zuckerberg this week is reason for him to lean on Facebook's board, Sonnenfeld added, not only for its expertise but to help loop in some of Facebook's most prominent critics. Sonnenfeld said companies that learn to immerse themselves in tough criticism - such as privacy experts, for example - are often most equipped to turn the corner out of a crisis.
"When things like this happen, people will take a look at whether the leadership team of Facebook is the right team to have in place," said Gabrielle Adams, assistant professor of public policy and psychology at the University of Virginia.
On top of Facebook's internal insecurity, Adams noted that its stock market beating also shapes user perceptions of a company already shouldering a record of privacy and security breaches. Some users might take the stance that "you deserve this, and this is justice or punishment," while others might view the US$100b drop as "not what Facebook deserves."
Facebook's task is to reach both of those groups, Adams said, and show it is taking the blunders of the past few months and Thursday's stumble seriously.
Minow noted that much of the consumer mistrust in Facebook stems not just from Thursday's stock drop, but from a longer-term cynicism about the company's trustworthiness "as a provider of information and as a seller of its own personal information."
"They've begun to address it with some rebranding," Minow said. "But that's a big mountain to climb."
