Target prices for JP Morgan and others fall… Market cap 191 trillion won, Zuckerberg’s asset value evaporates 24 trillion won
Mark Zuckerberg Meta CEO
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(San Francisco = Yonhap News) Correspondent Kim Tae-jong = The stock price of Facebook’s parent company, Meta Platform (hereinafter referred to as Meta), plunged more than 10% on the 25th (local time), the day after the first quarter earnings announcement.
On this day, Meta’s stock price closed at $441.38 on the New York Stock Exchange, down 10.56% from the previous day. This is the largest decline since October 2022.
During the day, it fell 16% to $414.50.
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The market capitalization also evaporated in one day, from $1.258 trillion to $1.119 trillion, or $139 billion (KRW 191.1 trillion).
Accordingly, CEO Mark Zuckerberg’s asset value also decreased by approximately $18 billion (24.75 trillion won). Zuckerberg owns 345 million shares of Meta stock.
The decline in Zuckerberg’s asset value today is the largest since his stock price plummeted 26% in early 2022, losing about $30 billion.
Meta’s stock price plunged because, despite first quarter performance exceeding market expectations, second quarter guidance (performance expectations) fell below market expectations and spending on artificial intelligence (AI) investment was expected to increase.
In its earnings announcement the previous day, Meta estimated that sales in the second quarter would range from $36.5 billion to $39 billion.
This median estimate ($37.75 billion) is an 18% increase from the same period last year, but falls short of the market forecast ($38.3 billion).
This year’s capital expenditures were also raised from the previous forecast of $30 billion to $37 billion to $35 billion to $40 billion. Meta explained that this is due to the continued acceleration of infrastructure investment to support the artificial intelligence (AI) roadmap.
“We are investing aggressively in ambitious AI research and product development, so capital spending will continue to increase next year,” Chief Financial Officer Susan Lee said.
“Building a leading AI will be a bigger task than any other experience,” Meta CEO Mark Zuckerberg said after the earnings announcement. “In the past, stock prices have been highly volatile during non-revenue-generating stages.” .
This meant that they were not overly concerned about the short-term decline in stock prices, but it raised investors’ concerns along with the losses of Metaverse, into which Meta is pouring a huge amount of money.
Reality Labs, which produces the Metaverse headset that Meta is focusing on along with AI, recorded sales of $440 million, up 30% from a year ago.
Operating loss decreased from a year ago ($3.99 billion), but still amounted to $3.85 billion.
Accordingly, investment companies lowered Meta’s target stock price one after another.
Bernstein maintained Meta’s investment rating but lowered its target price from $590 to $565.
“The current business strategy is expensive and it will take a long time to recoup the benefits,” Bernstein said.
JP Morgan lowered its target stock price from $535 to $480, and Barclays also lowered its target stock price from $550 to $520.
taejong75@yna.co.kr
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2024/04/26 08:43 Sent
