Facebook's stock tanked after a disappointing second-quarter earnings report that saw the company miss revenue expectations and warn of slowing growth ahead.
The Trillium Assets proposal charged that the lack of an independent board chair and oversight contributed to Facebook "missing, or mishandling, a number of severe controversies", including the social media site being used for the Russian meddling in USA elections, the sharing personal data of 87 million users with Cambridge Analytica, proliferation of fake news and others, the Business Insider said. Analysts who follow Facebook were blindsided, asking frequently on a conference call with executives for more information on exactly how the company's financial future had changed so dramatically.
Even though things are now looking dismal for Facebook, there are a handful of Wall Street analysts who are holding to a positive outlook for the company, even though they conceded that the abysmal second quarter results were worse than anticipated - not to mention the fact that European privacy laws just went into effect at the end of May.
Facebook also had 185 million North American DAUs and 279 million European DAUs, below the FactSet forecasts of 185.4 million and 279.4 million respectively.
The news sent Facebook's stock free-falling almost 25 percent in after-hours trading.
"The guidance from management over their expectations for revenue growth to decelerate so markedly for the rest of the year did take us, and the market, by surprise", said Christopher Rossbach, chief investment officer at J. Stern & Co.
On the call, Jefferies & Co. analyst Brent Thill said that "many investors are having a hard time reconciling that deceleration".
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In fact, the call with Zuckerberg and his colleagues only made things worse for Facebook's share price.
The results are from the first full quarter following the revelation of the Cambridge Analytica privacy scandal.
The new laws were only in effect for one month of the quarter, which means the company may feel more of an impact in the current quarter.
For founder Mark Zuckerberg, the loss came to nearly $16 billion, according to Forbes, which tracks billionaire wealth in real time. The company has been hiring more people and concentrating resources to improve privacy and data security, and increase policing of the site to tackle misinformation and election interference.
Some investors were also dismayed with Facebook's revelation about Instagram Stories, which allow users to post videos or photos that disappear after a day. "Real world issues that people thought should affect the company are now affecting the company".
The company reported its second-quarter earnings after the bell on Wednesday. Ciaccia noted. "Facebook's market cap has fallen roughly $120 billion - or the amount General Motors, Ford and Target are worth ... combined".