The 34-year-old Facebook billionaire, who had been worth as much as $86.5 billion when Facebook stock traded at an all-time high earlier in the day, now has a net worth of about $68.9 billion, based on regulatory filings with the U.S. Securities and Exchange Commission.
Facebook reported a 42 percent increase in revenue and a 31 percent jump in profits for its second quarter, compared with a year earlier.
Facebook's first financial stumble in three years followed a quarter in which data-privacy issues came under harsh scrutiny, with chief executive officer Mark Zuckerberg testifying before US Congress for hours on the company's missteps. While the company posted an earnings beat, revenue was below analysts' guidance as the company raked in $13.23 billion in sales, below the $13.23 billion that analysts were calling for.
Total expenses in the second quarter surged to $US7.4 billion, up 50 per cent 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.
Wehner attributed the poor revenue expectations to several factors: currency headwinds, the R&D cost of building and promoting new experiences, and impacts on Facebook's business from new privacy regimens in Europe due to GDPR. Fourteen analysts surveyed by Zacks Zacks Investment Research expected $13.43 billion.
Strong ad sales from Google, which is Facebook's main competitor for online advertising, had sent expectations for the social network's earnings up, along with its stock price. Many Facebook analysts hope that Instagram's growth will help offset any stagnation at the older social network.
According to the research firm, Facebook-owned Instagram is making up for some of the slowdown in growth at the social network and will generate US$8.06 billion in worldwide ad revenue this year. Facebook's results prompted selling in other Nasdaq listings, including media and advertising rivals Amazon.com Inc, Netflix Inc and Alphabet Inc. The quarter was also marked by Europe's implementation of strict new data laws, which Facebook said led to fewer daily visitors in that region. In North America, an effort to get all political advertisers to verify their identities may have halted some purchases as the company worked through its broad definition of what's considered "political".
Of the newer endeavors, Instagram's business model is the most mature, and likely contributed meaningfully to revenue in the quarter, analysts have said.
The firm, which is facing backlash for its handling of fake news and privacy, said it had 2.23 billion monthly active users at the end of June. Mobile ads accounted for the vast majority of Facebook's total revenue, but also came up short of analysts' estimates.
Before the results were announced, Facebook's shares had closed in NY at $217.50, a record high, and had gained 23% this year.
Facebook's headcount increased 47% year-on-year, to 30,275 as of June 30, 2018.
The problem: weaker-than-expected revenue growth, Facebook's first such miss since 2015.