A drop in Facebook shares was observed after yesterday's service outage and the revelations of whistleblower Frances Haugen.
Facebook shares fell nearly 5% on Mondayafter the company suffered its worst outage in nearly 13 years, with users unable to access Facebook, while Instagram and WhatsApp also experienced similar problems.
See also: Facebook: Puts brakes on plans to develop Instagram for children
However, the market was generally down on Monday. The decline was particularly sharp in social media stocks, as Twitter, Snap and Pinterest each fell more than 5%.
Facebook shares fell 4.9% yesterday, their biggest drop since a 5% drop on Nov. 9, 2020. The situation has cost Facebook founder and CEO Mark Zuckerberg about $6 billion in his personal fortune, according to Bloomberg. The young billionaire fell below Bill Gates on the list of the richest people in the world yesterday.
The drop in Facebook shares, however, was certainly linked to the long outage of its most popular services.
“We’re aware that some people are having trouble accessing our apps and products,” the company said in a tweetyesterday. “We’re working to get things back to normal as soon as possible, and we apologize for any inconvenience.”
See also: Facebook Down: It attributes the outage to a "faulty configuration change"
The outage marks the worst outage for Facebook since 2008, when a bug took the company's services offline for about a day, affecting about 80 million users. The company now has 3 billion users, so we understand that yesterday's outage affected a large number of people.
However, the drop in Facebook shares is likely due to another event: the revelations of a former executive on “60 Minutes.” Whistleblower Frances Haugen said that the social networking platform knows about the problems its apps have and that they are used for misinformation, but puts profit above all else.
Learn more: Facebook Whistleblower: Accuses the company of profiteering
Haugen said she made many of Facebook's internal files public, leading to a number of recent reports about the company's practices.
The whistleblower left Facebook in May and made copies of several internal files before leaving. The former executive accused Facebook of prioritizing “its own profits over public safety – putting people’s lives at risk.”
Source: CNBC
