Mark Zuckerberg’s fortune falls by $2.5bn over just two words
Mark Zuckerberg lost $2.5bn (£2bn) from his fortune after Facebook’s management announced revenue would “meaningfully” slow and it was ready to make “aggressive” investments.
Those two words reportedly caused Facebook shares to fall by five per cent despite another record-breaking quarter where sales increased by 56 per cent to just over $7bn.
The company did not mention specifics but did say it expected advertisement load, the number of adverts shown to users, to play less of a role in revenue growth. Facebook was however adamant that it would “continue to work hard to innovate” its advert offerings, Forbes reported.
Doug Anmuth, an analyst at JP Morgan, said the wording was important.
“Many will hang on ‘meaningfully’ lower ad revenue growth in 2017, but we think management’s top-line comments were largely consistent with what they said [last quarter],” Mr Anmuth told Forbes.
Facebook said it would continue making “aggressive” investments in new engineering and technology hires. Gene Munster, an analyst at Piper Jaffray, said this might cause a temporary downturn but would be worth it in the end.
“While this will likely put a damper on investors’ short-term outlook, Facebook is making the right investments, which should pay off in spades during 2018 plus,” Mr Munster said.
Mr Zuckerberg is the world’s fifth richest person with a fortune of $52bn according to the Bloomberg Billionaires Index.
Independent News Service