Facebook stock was down over 20 percent in after-hours trading yesterday after the company announced earnings that missed expectations, along with expectations of slower growth in the future. The drop, which was the largest single decline in the firmâ€™s history as a public company, wiped more than $100 billion from the companyâ€™s market value.
It wasnâ€™t the first time Facebookâ€™s shares had plunged. Back in March, after the Cambridge Analytica scandal came to a head, the stock shed 18 percent of its value over two weeks. But since that low, it had risen to day after day of new, all-time highsâ€”up about 70 percent overall. That recovery made the company seem unstoppable, even in the face of its role in data extraction and election manipulation.
This time, thereâ€™s no single reason for Facebookâ€™s reversal. Instead, a combination of factors is creating headwinds for the company, and thatâ€™s not going to stop anytime soon. But even so, Facebook has enormous room for growth, and taking this setback as a sign of the companyâ€™s overall decline is wrongheaded. For better or worse, Facebook is fine, even if it is also terrible.
Wall Street can be fickle,