Meta loses nearly $200 billion in value after Mark Zuckerberg announcement

Indigenous Affairs Social Media (ASSOCIATED PRESS)
Indigenous Affairs Social Media (ASSOCIATED PRESS)

Meta’s share price has fallen almost $200 billion in the wake of an announcement by Mark Zuckerberg.

The company reported its results overnight, which showed higher costs and smaller-than-expected revenues. Much of that was the result of investment in artificial intelligence.

During those results, chief executive Mark Zuckerberg said that it could take “several years” for its work on AI to scale up and start making money.

That led to fears among investors that the company’s huge investments in artificial intelligence may not pay off, and that the company’s fortunes might be weaker than previously thought.

That triggered a sell-off that saw Meta shares fall $190 billion when trading opened on Thursday morning. Its value fell almost 15 per cent.

The worry about Meta also led to falling share price at other social networks. Snap fell 4.8 per cent, for instance, while Alphabet, Amazon and Microsoft were down between 1.5 per cent and 2.7 per cent.

Mr Zuckerberg had looked to reassure its investors that there would be money to be made from its AI products – even if that revenue is not arriving yet.

“There are several ways to build a massive business here, including scaling business messaging, introducing ads or paid content into AI interactions, and enabling people to pay to use bigger AI models and access more compute,” he said.

“And on top of those, AI is already helping us improve app engagement, which naturally leads to seeing more ads and improving ads directly to deliver more value.”