President Donald J. Trump welcomes Facebook CEO Mark Zuckerberg Thursday, Sept. 19, 2019, to the Oval Office of the White House. (Official White House Photo by Joiyce N. Boghosian)
For the first time ever, Facebook (now officially part of Meta) has lost users. For the last quarter of 2021, Facebook reported a drop of almost 500,000 daily logins. The loss comes at a time when younger users are opting instead to use the short-form video app TikTok. Meanwhile, conservative users are abandoning the platform in droves in response to Facebook’s left-leaning censorship. The bad report caused a 20% drop in the price of Meta stock overnight. Taking a bet on Meta’s appeal to users is simply not investing. The Daily Mail’s Natasha Anderson reports:
Analysts allege investors had expected signs of declining user growth but were ‘taken aback’ by the amount of ad dollars the company lost in wake of TikTok’s growth.
TikTok is dominating the short-form user-generated video market, despite Meta offering its own Reels product on Instagram.
Data indicates the platform lost consumers to TikTok and saw lover revenue from ads destined for its short-form videos, according to Bloomberg.
The figures, however, should not have blindsided investors as there have been repeated signs that Meta was trying to compete with the new video format.
Last summer, Instagram chief Adam Mosseri moved the platform’s focus to embrace videos instead of its usual emphasis on photo-sharing, a move Mosseri said was inspired by TikTok’s rising popularity.
Zuckerberg emphasized the move during Wednesday’s earnings call, reiterating that Instagram would continue to focus on Reels.
The CEO has also been adamant that Meta’s long-term success is dependent on his Metaverse vision.
However, figures reveal the company has lost over $20 billion on Metaverse projects over the last three years.
The data also revealed that consumers are being less interested in the Facebook platform, specifically in Africa and Latin America, where the loss of daily users was greatest. Some analysts allege this shows the product may be globally saturated.
Meta’s fourth quarter earnings reports also indicate the platform’s user growth has stalled in the US and Europe, a trend witnessed over the last several years.
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