Facebook/Meta shares lost nearly half their value in six months

Facebook's shares sunk 45% in value since the beginning of September. Then the company was worth more than a trillion dollars and the world's fifth largest. Now it's trading at a market cap of $565 billion and has slipped out the top ten. Bloomberg Business calls it a "collapse unmatched in the era of big tech."

The stock has seen a drumbeat of bad news, including Google's announcement this week that it would bring a privacy initiative to Android phones. While the company said the move is ad-friendly, it's reminiscent of Apple Inc.'s changed privacy policy, which dented digital advertising and was a factor behind Meta's catastrophic earnings report this month. The results called its growth prospects into doubt and spurred the biggest selloff in Wall Street history in terms of value erased.

"The management team needs to show investors over the next few quarters a path to growth," said David Wagner, portfolio manager at Aptus Capital Advisors. He added that the stock, which he owns, is "in purgatory," and that sentiment "couldn't be lower."

Bearing in mind that its inflated share venue reflected the expectations and hopes of speculators, not the real world where Facebook's revenues remain steadily enormous rather than explosively so, it does show that things aren't working out as expected in the cult of Meta.

The lesson to take home is that there are layers to the advertising-supported internet (cf. the OSI model) and a company's position on it depends on those closer to the hardware. Facebook's attepts at hardware and operating systems failed quickly, leaving it a layer or two out from Google and Apple. So Google and Apple's decision to limit Facebook's access to user data is a crushing problem for it. Hence the growing desperation about the metaverse and making it happen.