Mark Zuckerberg has lost billions following Meta's share price bloodbath. Photo / AP
Mark Zuckerberg has lost billions following Meta's spectacular share price crash – and now, attention is turning to what really went wrong for the social media giant.
The 37-year-old's personal wealth has plummeted by more than $46 billion – one of the biggest falls ever recorded – after Meta shares dropped by a staggering 26 per cent on Thursday afternoon US time, wiping off more than US$250 billion ($750 billion) in value.
Meta Platforms, formerly known as Facebook, recorded the horror result in the wake of a dismal revenue forecast released late on Wednesday, which revealed the company was facing skyrocketing costs while growth had stalled.
The news has sent shockwaves across global markets – but what exactly caused the bloodbath that has left the tech juggernaut reeling?
One of the major reasons for the stock wipe-out was the revelation that for the first time since it was founded in 2004, Facebook's growth stalled – with the platform actually losing users.
It's the first time this has happened in its 18-year history, with more than half a million users deserting the site in the last three months of 2021.
That has taken the total number of daily Facebook users from 1.93 billion to 1.929 billion.
In a telling sign, the loss was most significant in the previously growing markets of Africa and Latin America, following slowing growth in the US and Europe in recent years.
The fall in these key developing markets indicates that Facebook may have reached global saturation levels, which would mean the trend was here to stay, and not just a temporary blip.
And growth across the parent company's other platforms, such as WhatsApp, Messenger and Instagram, was also relatively weak.
In October 2021, Facebook announced its rebrand to Meta to much fanfare.
The name comes from the Greek word for "beyond", and was chosen to reflect Facebook's transition away from being a social media platform only.
Instead, Facebook revealed a new, major focus on developing the metaverse by investing heavily in virtual and augmented-reality hardware.
But that transition comes at a mind-blowing cost.
Last year, Meta invested more than US$10 billion ($15 billion) in its Reality Labs division – which includes its virtual reality Oculus Quest headsets and augmented reality technology – which contributed to the fall in profit.
Part of that involved growing the team by 23 per cent, to a total of 71,940 staff members.
In the last quarter, Facebook Reality Labs lost US$3.3 billion ($4.9 billion), and more than US$10 billion ($15 billion) across the entire 2021.
With the metaverse still years away from becoming mainstream, most insiders expect that loss-making trend to continue for some time.
Zuckerberg also called out competitors such as TikTok and YouTube, blaming the rise of these rivals for Meta's grim results.
"TikTok is so big a competitor already and also continues to grow at quite a fast rate," Zuckerberg said, adding the firm was now investing in its own version of the popular video platform, Reels.
"People have a lot of choices for how they want to spend their time, and apps like TikTok are growing very quickly," he continued.
"And this is why our focus on Reels is so important over the long term."
Zuckerberg also blamed Apple for its horror quarter, with Facebook set to lose a whopping US$10 billion ($15 billion) in 2022 following a significant iPhone change.
In 2021, Apple added a new function to iPhones that would bar companies from tracking users across apps.
As a result of Apple's iOS 14.5 update, the overwhelming majority of users opted out of tracking – and it has given Facebook revenue a hammering.
"The impact of iOS overall as a headwind on our business in 2022 is on the order of US$10 billion ($15 billion)," Meta CFO David Wehner said.
"We're working hard to mitigate those impacts and continue to make ads relevant and effective for users."
That's because most of Meta's revenue comes from advertising as a result of the firm's trove of personal information collected from users – but the Apple change meant that a sizeable chunk of that valuable data was lost.
Meta also claimed inflation had impacted advertising budgets.
Meta's gloomy results come after a tumultuous few years for the company, which has been plagued by scandal after scandal.
Last year, whistleblower and former staff member Frances Haugen leaked the so-called "Facebook Papers" to the media and the Securities and Exchange Commission, and testified before Congress, claiming Facebook put profits over people's safety.
In February 2021, Facebook's bombshell decision to temporarily ban Australian news from the platform also sent shockwaves across the world, and sparked a massive boycott push.
In 2019, NBC News obtained and released thousands of pages of leaked internal documents which revealed Facebook's plan to grow ever-powerful, including an alleged strategy of using users' data as a bargaining tool to wield against rivals and help out allies.
In 2018, it was rocked by the Cambridge Analytica fiasco, which involved the selling of tens of millions of Facebook users' personal data to political data firm Cambridge Analytica, without their consent, with the information later used to influence voter behaviour during the 2016 US election (although the breach was not known at the time).
Facebook was ultimately slapped with a US$5 billion fine as a result of the largest data scandal in its history.
In 2018, it emerged the platform had also been used by anti-Rohingya accounts to incite genocide against the Muslim Rohingya community in Myanmar.
The platform was also accused of spreading mass misinformation in the lead-up to the 2016 US election, and in 2017 it was revealed that hundreds of likely Russian fake Facebook accounts spent around US$125,000 on ads during the election campaign.
In 2016, it also landed in hot water after censoring a number of images and videos including a famous Vietnam War picture and clips of the Dakota Access Pipeline protests, and in 2014, Facebook faced yet another major backlash after it was revealed it had secretly carried out psychological tests on almost 700,000 unwitting users back in 2012.