Mark Zuckerberg’s fortune tumbles $16.8 billion in a day

Mark Zuckerberg’s fortune tumbles $16.8 billion in a day

Facebook shares fell as much as 24 percent in after-hours trading Wednesday after sales growth didn't meet expectations - and the social media giant said it would continue to decelerate.

The company's growth numbers also slowed down notably: Daily active users only increased 11% year-over-year, to the tune of 1.47 billion on average during the month of June.

Facebook shares dropped 20.8 percent from their closing price on Wednesday, reaching a level last seen when Facebook was mired in a scandal over data that ended up in the possession of political consulting firm Cambridge Analytica.

"Our community and business continue to grow quickly", Facebook CEO Mark Zuckerberg said in a statement.

On the Q2 earnings call, CFO David Wehner said the company expects revenue growth to slow to single digits over the next two quarters from 42% year-over-year in the second quarter.

The Menlo Park, California-based company reported net income of $5.11 billion, or $1.74 a share, compared with analysts' average estimate of $1.71 a share, according to data compiled by Bloomberg.

Total expenses in the second quarter surged to $7.4 billion, up 50 percent compared with a year ago. Worldwide daily user growth for Facebook's namesake service slid for its sixth straight quarter, bringing it to almost 1.5 billion users in the second quarter.

"The core Facebook platform is declining", said Brian Wieser, an analyst at Pivotal Research Group.

Facebook suffered a blow in China on Wednesday when regulators there withdrew their approval of a company innovation hub to support local startups, the New York Times reported on Wednesday (local time), citing a person familiar with the matter. Many Facebook analysts hope that Instagram's growth will help offset any stagnation at the older social network.

The new General Data Protection Regulation (GDPR) in the European Union forced several changes to Facebook's privacy terms and sign-up process.

Last week, Facebook incited controversy once again during a Recode interview, in which Zuckerberg said that some Holocaust deniers who posted to the social network aren't "intentionally getting it wrong". In Europe, things were looking dicey as Facebook (NASDAQ:FB) lost 1 million users, sinking to 376 million monthly active users.

While privacy was an issue in Europe, politics played a role in North America, which is the company's most lucrative advertising market. More than 2.5 billion people used at least one of its apps - Facebook, Instagram, Messenger, or WhatsApp - during the month of June.

Facebook has said it will increase spending to make investments in video content, and on new bets like artificial intelligence and virtual reality.

Facebook's shares had earlier closed in NY at US$217.50, a record high, and had gained 23 per cent this year.

But there's also been a notable slowdown in user growth. He said the challenges included regaining public trust as well as increasing the number of people joining Facebook and the time they spent on the platform.

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