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As a subscriber you can listen to articles at work, in the car, or while you work out. Subscribe NowFacebook parent Meta’s quarterly earnings report on Wednesday revealed a startling statistic: For the first time ever, the company’s growth is stagnating around the world.
Facebook lost daily users for the first time in its 18-year history—falling by about half a million users in the last three months of 2021, to 1.93 billion logging in each day. The loss was greatest in Africa and Latin America, suggesting that the company’s product is saturated globally—and that its long quest to add as many users as possible has peaked.
Meta’s stock price plummeted nearly 24% in trading Thursday, dropping to about $246 per share and wiping more than $200 billion off its market value. The company is facing challenges on multiple fronts, as competitor TikTok booms, federal and international regulators scrutinize its business practices, and it begins a lofty transition to focus on the “metaverse.”
It adds up to a dizzying blow for a company that has long been defined by its relentless obsession with growth. The social network’s meteoric rise from a Harvard dorm room in 2004 to 1 billion monthly active users in 2012—and then 2 billion just five years later—was fueled by a mission to connect the world, including efforts to bring more people online in developing countries so it could sign them up, too.
Its newest ambition is off to a slow start, at least by one key metric. Facebook showed for the first time on Wednesday how much of a money-losing proposition its investment in virtual- and augmented-reality hardware is—the suite of products the company dubs the metaverse.
Facebook Reality Labs, the company’s hardware division that builds the Oculus Quest headset, lost $3.3 billion in the quarter, despite bringing in $877 million in revenue.
But even that figure is a tiny fraction of Facebook’s total revenue—$33.67 billion last quarter—primarily derived from targeted advertising on its main social network.
The company has made significant investments toward its aspiration of becoming a hardware giant, including hiring over 10,000 people and rebranding itself to Meta. But that transition is still in its early days.
“Last year was about putting a stake in the ground for where we are heading; this year is going to be about executing,” CEO Mark Zuckerberg said on the company’s earnings call.
Executives hope that the company can reinvent itself with a focus on hardware, and that doing so will distract from its political problems. Tens of thousands of internal Facebook documents brought forth by a whistleblower last year revealed that it is accelerating societal polarization and that its algorithms have amplified misinformation and helped violent groups organize on the platform. The company is under intense government scrutiny, facing a major antitrust case in the United States and expected laws in Europe that could transform its business. It recently shuttered its cryptocurrency project, Diem, in response to intractable political pushback.
Facebook’s user growth has stalled in the United States and Europe for the past several years, but the company previously made up for it by consistently adding users all over the world. These new numbers, which show a dip in daily active users on the Facebook app, suggest that Facebook is becoming saturated globally, as well—a trend that demonstrates another reason the company is pushing so forcefully into new arenas such as hardware.
But not all growth trends were negative. The company’s family of apps, which encompass Instagram, WhatsApp and Messenger continued to modestly add users. The number logging in monthly to Facebook continued to grow, even as the number of daily users dropped. And the company continued to earn slightly more revenue per user, as well.
The company also said it was changing its stock ticker symbol to META from FB. It changed its corporate name from Facebook to Meta in October, saying at the time that it wanted to reflect its focus on the metaverse. But the change also came amid regulatory scrutiny of the company’s size and power, which was heightened after whistleblower Frances Haugen turned over internal company documents to Congress and the U.S. Securities and Exchange Commission.
Zuckerberg spoke several times on the earnings call about the competitive threat the company faces from video platform TikTok, and he explained that this competition was the reason the company was pushing hard to develop its short-form video product, Reels.
Zuckerberg conceded on a call with investors that the company faces growing competition in the race to capture people’s attention online and would need to work to make sure Reels brought in more money.
“People have a lot of choices for how they want to spend their time, and apps like TikTok are growing very quickly,” he said. “And this is why our focus on Reels is so important over the long term.”
But the CEO’s unusually frequent references to competition also could be read as a message to critics who say the company is an all-powerful monopoly.
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If it’s free online, you’re paying for it by giving up your privacy, information, or attention.
Quitting Facebook remains the best thing I’ve done online (did it several years ago) and I encourage everyone to try a Facebook vacation by deactivating their account.
https://m.facebook.com/help/250563911970368/?helpref=hc_fnav
Though we disagree on virtually everything, I know you’re a smart fellow and I’ll have to at least pinpoint those times where we’re in absolute agreement.
That said, I think Facebook’s woes are worse than the company is letting on. They’re losing users for the “first time in history”…in aggregate. As this article notes: “Facebook’s user growth has stalled in the United States and Europe for the past several years, but the company previously made up for it by consistently adding users all over the world.”
FB has been losing users precipitously in the US for probably close to a decade. It’s now seen as a Boomer app by the trendy kids who are addicted to Snapchat or a piece of Chinese spyware commonly referred to as “TikTok”. It has compensated for its American user loss by surges in emerging economies like India, Philippines, Thailand, Brazil, and the more stable countries in the Middle East (which, in reality, is most of them). But it’s probably reached its peak there as well, and its only major source of capital when it’s running out of ideas is the fact that it has harvested so much data on gullible American users, which it sells to marketing conglomerates all across the world for algorithmically strategic spamming.
Given how much social media is responsible for social alienation, cult-like groupthink and the resultant political polarization (something taking place all across the First World despite the zeal to pin it all on a certain orange buffoon), won’t it be FUNNY when Facebook goes the way of MySpace? Or Friendster?! Sadly, it’s only going to get replaced by something else if that happens–or, even worse, the more vibrant Big Tech oligarchs will join forces to prop it up (like they’re currently doing with that other dinosaur Twitter).
Oh yeah, sure. They’re all in cahoots helping each other.
Facebook Says Apple’s Privacy Push Will Cost $10B (But Can’t Stop It)
https://www.thestreet.com/investing/facebook-says-apples-privacy-push-will-cost-10b-but-cant-stop-it
Collusion, indeed.
YIPPEE! ‘Never had a Facebook account and had no intention of getting one. As sinister an organization as has ever been foisted on the public, what with their selective platform dismissals / blockages / deplatforming based on their arrogant political and cultural persuasions. This is good news indeed.
Adorable, Bob. Facebook amplifies and profits on the worst of human nature and you think the problem is that they actually try to do something about it.
Here’s the reality – I seriously doubt Trump’s ever president without Facebook. And if Facebook never existed, I seriously doubt the Republican Party would have been overtaken by cranks and loons.
Go read everything the whistleblower published last year. I’ll wait. It’s damming – Facebook has built a right wing propaganda machine, and they can’t turn it off because they’d lose money and their right wing executives (which exist in high places) know exactly what kind of weapon they have. That’s why they let conservatives break Facebook’s own rules over and over and over again – they need them to make money. But please, whine some more about deplatforming while people use Facebook to organize an attack on the Capitol.
Facebook is a menace and should be sued out of existence for the harm they cause. They know they’re a problem but refuse to do anything about it. Just as bad as the tobacco companies.
https://www.cbsnews.com/news/facebook-whistleblower-frances-haugen-misinformation-public-60-minutes-2021-10-03/
Okay, a broken clock is right twice a day. A pat on the head to Joe for his good take at 12:30p, which helps compensate for his utterly predictable normie lamestream media take here. Quoted from CBS, no less!
The “whistleblower” for Facebook is as astroturfed as they get: she was a hardened leftist (which today means crooked crony capitalism) who is desperate to salvage the declining fortunes of legacy media, which Big Tech in turn is desperately trying to prop up. Everything she said in her testimony was rehearsed and scripted and approved by her friends at Facebook and CBS and NYT and dying industries like CNN (probably only surviving from paid adverts from Pfizer). It’s not a coincidence that Facebook stifles independent political commenters like Steven Crowder (on the right) or Jimmy Dore (on the left) to favor bazillioin dollar companies like CNN, MSN, or Fox who toe the line.
The whistleblower was a red herring to distract the normies and convince them that legacy media is still questioning power structures. (They aren’t. They’re defending them because the power structures are buttering their bread.) If she were a true “whistleblower”, people would be trying to shut her up (after all, she’d be speaking truth to power). But they rolled out the red carpet for her! The reality is that even though FB censors far-left and right political views (anything hurting the billionaires’ coalition) the rightwingers who embody populism vastly outnumber the supporters of AOC, whose “democratic socialism” is a ruse because in the end she does the bidding of the elitists while getting gullible millennials to vote Blue no matter Who. She hates the MAGA populism as much as the neocons and neolibs (basically the same thing–Bush/Cheney and Obama/Pelosi are fundamentally indistinguishable) because they represent a threat to the world order that enriches the Big Tech oligarchs and their political enablers by demanding a government that is response to the middle class…which people like the “whistleblower” hate as much as Bush, Pelosi, Zuckerborg, and Gates.
But you’re right on one thing: they do need the “conservatives” (mostly populists, since many aren’t conservative and would support Sanders if he weren’t all bark and no bite) because they’re much greater in number. And as the dying neo-cons join forces with the neo-libs to violate the constitution so that they can withhold their aristocratic status quo at the expense of the filthy peasantry, the populist drum-beating is only going to grow. How long before we get a French Revolution in a place like Australia or Canada? The politicians are already doing their best Marie Antoinette impressions.
At some point, Joe, you’ll hopefully learn what that “far-right” (and persistently more accurate) polling company Rasmussen recently uncovered: that nearly 60% of Americans recognize that the mainstream media is “the enemy of the people”.
Let me guess – all the documents were fakes too?
Populism never works. Give it up. It’s a road to nowhere.
I won’t touch FB. I gently “unfriended” my FB friends over 10 years ago and permanently logged out. Not the root of all evil, but its algorithms are the root of a lot of evil.
I deleted my Facebook account in January, 2021, and it was way overdue. Life is much better without it.
Good news!! Let’s get back to being human!!! Face to face talking!!!
👍
I enjoy Facebook for seeing pictures of friends, their families and their activities.
I don’t use it for anything else but that and am completely happy with it.
I would have deleted FB a long time ago but I still the use the market place. Everyone sells everything on there and I can’t find deals anywhere else. Craigslist is a ghost town now.