The shares fell by Facebook Inc., including up to 20 percent on Thursday after months of scandal in Cambridge, and the involvement of the company in violation of the data users along with the growing flow issues in the U.S. elections, news, fake, hate speech, sacrifice and Publishers from the decline of visits to their sites.
Problems are multiple and interrelated too, has found the crisis resulting from its way finally to the financial results to be the result as we mentioned already.
Was the financial performance of the company Facebook previously immune to criticism fierce content policies, and his failure to protect users ‘ private data, and rules changing for advertisers and publishers, but on Wednesday, revealed Facebook about the sales figures and the growth rates of users for the second quarter which did not live up to the expectations of analysts, which spooked Wall Street investors in the market.
The company’s shares plummeted dramatically in its history as a public company, losing $ 120 million of its market value at least, and sometimes in trades to the $ 150 million of losses.
This represents the largest loss in one day to buy stores in the United States. Was trading stock when 179.92 $ at 9:41 a.m. in New York.
I told the police Wall Street that the figures will not bear this year, said Finance Director David feiner, the rate of revenue growth will fall in the third and fourth quarters.
It was the analysts who follow Facebook directly, asking repeatedly in a phone conference with the executives to get more information about how to change the future of the company’s financial is very large.
Said Brent Teal’C, analyst firm Jefferies, the executives at Facebook: “I think that many investors have difficulty in accepting this slowdown”, they asked for more clarifications in this regard and how it will affect the financial future of the company.
The growth of users and revenue of social networking, the most important criterion for investors, once you begin to signs of a slowdown emerge tends many of them for sale.
For Facebook, the pitfalls of the past are very rare, they are a successful company on a financial level and and is one of the fastest growing companies in the world, was the last time you missed where the company estimates revenue in the first quarter of 2015.
The financial results announced yesterday, Wednesday very natural given that the company’s involvement in a lot of cases, the worrying was the worst ever scandal leaked data of about 85 million users and allow them to buy a car advice and support Donald Trump in the access to power in the United States, has made CEO Mark Zuckerberg to testify in front of Congress for hours over two days because of that issue and other errors multiple.
On the other hand, there are Europe to develop strict laws to new data, resulting in a lower number of daily visitors in that region.
You know, the company got into trouble because of their criticism of the public policy of its own content, especially in countries like Myanmar, Sri Lanka, where he led the misinformation to acts of violence and killing, there are indications of use of Facebook for the same purpose in the Middle East and North Africa to mislead the public and urged him to commit acts of violence for political purposes.
And continued suffering of the Facebook fallout from investigations into manipulation of the Russian organization during the U.S. presidential election of 2016, where Russia continues to charge to use Facebook and social media in the broadcast, publications and content that helped steer the American public to vote for Donald Trump especially in some of the battleground States which has been targeted by ads.
All these problems collide a harsh reality for the company: facebook, the social network, which includes 2.23 million monthly users active, can’t grow forever.
Said Brian West, an analyst in the group pivotal research: “the core product of the company is on the decline”, in reference to the decline of growth significantly.
He said Facebook he has 1.47 million active users in June, compared with an average analyst estimate of $ 1.48 billion compiled by Bloomberg.
Reached the user base of the company in its largest market, the United States and Canada, to 185 million users daily, while it declined by 1% in Europe to 279 million users daily. In general, the greater the average number of daily users increased by 11 per cent from the same period last year.
Revenue rose by 42 percent to $ 13.2 million in this quarter which is less than analysts expected and a $ 13.3 million, and remains the social network with the second largest advertising platform after on and control the ads in the mobile through a range of its applications.
While some experts agree that growth will not continue forever, particularly as the applications and services the company has entered into the majority of homes and businesses, swept different continents at lightning speed, there are of the opinion that there are opportunities for even stronger growth if the company has succeeded in providing free internet in remote areas, third world countries, in addition to their entry to the Chinese market where a ban 10 years ago.
The most likely decline analysts the company’s revenue growth to three reasons, namely: volatility of dollar currency, increase investment in new types of content sharing, such as video clips that you choose and by the story, the biggest challenge for the user in privacy, which is a direct response to the demands and pressures suffered by the company.
After entering the list of General Data Protection came into force in Europe, began a Facebook site asking people check the privacy settings and make sure that they want to share certain types of data.
If the users share less data with Facebook, this may lead to obstruction of the capacity of ad targeting company, which makes them less attractive to marketers and advertisers.
While the privacy gate hit the big time to buy Facebook in Europe, played a policy role in North America, which is the advertising market the most profitable in the company.
Malfunction Facebook some business through the development of new rules to make all the advertisers and politicians to verify their identity. May be company has stopped further operations and buy advertising more than expected as the layer a broad definition of what is considered “political declarations”.
After the earnings report, executives to explain the potential of facebook and other that will not continue after significantly, it is WhatsApp, Facebook Messenger and Instagram in addition to video platform that was recently launched and is expected to compete strongly youtube.
The total group of users of the Facebook community of 2.5 million users monthly unique, as the company revealed during its statement the official yesterday.
Some analysts optimistic actually about the future of this company, but the mission emphasized that the level of it dark, it is best to currently stay away from buying its shares may not rise significantly during the remainder of this year at least.
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