Meta, formerly Facebook, faces historic drop as stock tanks

Meta is putting a lot of virtual eggs and billions of dollars into the metaverse basket, and Wall Street is spooked.

Shares of the company formerly known as Facebook saw a historic plunge on February 3, after it reported a rare profit decline due to a sharp rise in expenses, shaky ad revenue growth and fewer daily United States users on its flagship platform.

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At the same time, it invested more than $10 billion in its ambitious plan to transform Meta Platforms Inc. into a metaverse company.

Shares fell more than 26 percent, lopping off more than $230 billion of the company's market capitalisation.

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Meanwhile, a historic plunge in the stock price of Facebook’s parent company, Meta Platforms Inc., helped yank other tech stocks lower on Wall Street on February 3, abruptly ending a four-day winning streak for the market. The tech-focused NASDAQ gave up 3.7 percent, its biggest loss since September 2020. The S&P 500 fell 2.4 percent.

A weak revenue outlook for Meta helped drag the stocks of other social media companies including Twitter and Snap lower too.