Mukesh Ambani, Gautam Adani now richer than Mark Zuckerberg after Meta lost $29 billion
If you see the Forbes Real Time Billionaires List today (and probably for some more in the future), you might see that Gautam Adani and Mukesh Ambani are in the Top 10 Billionaires of the World list (btw, you can see a pre-pandemic and post-pandemic comparison of the net worth of the world's top 10 billionaires here). They have also been in the Top 15, but what is special is that now, they are both richer than Mark Zuckerberg, the creator of Facebook.
Both Mukesh Ambani and Gautam Adani have risen one spot on the Forbes list overnight, all thanks to Meta's poor quarter results.
WHAT HAPPENED?
Meta announced its fourth quarter results recently, which evoked a mixed response from the investors. As the word of their lesser-than-expected results came in, stock prices started falling drastically. Meta witnessed its largest stock price falls in a day as stock prices fell by 26.39%, setting the record of the largest stock falls in the history of US. Fall in stock prices also led to fall in Mark Zuckerberg's status, as his net worth dropped from $120 billion to approx $89 billion. This kicked him out of the Forbes Top Ten Billionaires List as Gautam Adani and Mukesh Ambani moved up the ladder. They are now in this order:
Rank 9: Gautam Adani
Rank 10: Mukesh Ambani
Rank 11: Mark Zuckerberg
WHAT WAS WRONG WITH FACEBOOK'S RESULTS?
Facebook lost its 'daily users' (for the first time in its 18-year history) in the last three months of 2021 (compared to the previous quarter) to 1.93 billion logging in each day . The fall was by about half a million users and was greatest in Africa, Latin America and India. This simply suggests that Facebook has been in its 'peak stage' of the product cycle and that it is steadily declining as it has saturated globally.
This statistic caused a major issue even though Facebook's massive rebranding streak of turning into Meta and turning its focus into Metaverse in the last year.
WHY ARE FACEBOOK'S DAILY USERS FALLING?
TikTok has been a massive competition for Facebook and has managed to gain better attention among people, who prefer creating viral videos on TikTok over Instagram and Facebook. Instagram's move of replicating Tiktok by implementing Reels is good, but does not stand as well as TikTok. TikTok has much more energy and influence over the world even if it does not have that many users. Also Facebook's inability to monetise Instagram reels is a sad financial truth for the company.
Facebook has also increasingly been in the news in the past few years for influencing public opinion. Facebook still faces criticism for its inability to combat misinformation, hate speech and other types of offensive content, problems that will continue to grow in complexity in the Metaverse.
Also, since the company is focussed on creating the new Metaverse over creating a better Facebook experience, looks like Facebook is not going to have more innnovations to retain its existing customers.
OTHER THINGS THAT ARE GOING WRONG WITH FACEBOOK
Facebook has had a history of both federal and international litigations and lawsuits and this has remained in public memory. It was also famously termed the 'Worst Company of 2021' in an online survey.
Meta’s business also took a big hit from the privacy measures Apple rolled out last year, which require developers to ask people for permission to gather data and track them across apps and websites. The change has had quite an impact on Facebook, which uses the personal information of users to build its massive digital advertising operation.
Facebook has also been busy rebranding itself as Meta and has been shifting focus to the Metaverse industry. But since Meta is in early stages of the Metaverse, the company is spending a lot of time and money in developing it, thus making Meta a presently unprofitable company. But despite Facebook's grand plans of expanding and investing in the AR, VR, and Oculus headsets, the public is afraid that Facebook will turn out like one of those long forgotten social media channels (RIP Orkut).
Facebook is mostly into internet advertisements and social media, and has no diversion of business interests, unlike Google who is at least into cloud computing. Looks like Facebook's Q4 results ended up bursting its Metaverse bubble.
How much time do you spend on Facebook?