What you need to know
- Facebook parent company Meta has missed its Q4 earnings target.
- Shares plummeted 20% following the news.
- The company has also warned that changes to privacy in iOS 14 will cost it some $10 billion.
Shares of Facebook's parent company Meta have plunged more than 20% following the news it had missed its Q4 earnings target and that privacy changes made by Apple would cost the company $10 billion.
From CNBC:
Facebook shares tumbled more than 20% in extended trading on Wednesday after the company reported disappointing earnings, gave weak guidance and said user growth has stagnated.
The company not only missed its Q4 earnings target but suggested that its first-quarter guidance would also be disappointing. CFO Dave Wehner went on to describe changes to iOS as a headwind in 2022:
"We believe the impact of iOS overall is a headwind on our business in 2022," Meta CFO Dave Wehner said on a call with analysts after the company's fourth-quarter earnings report. "It's on the order of $10 billion, so it's a pretty significant headwind for our business."
Shares finished down some 65 points, more than 20% by market close on Thursday.
Last year Apple made changes to iOS 14 on all of its best iPhones to make tracking using an IDFA identifier across third-party apps and services an opt-in feature. Facebook has repeatedly warned the move would hurt small businesses and its own bottom line, with the overwhelming majority of users seemingly opting out of the service.
In April 2021 Apple CEO Tim Cook said that the response to the feature had been "tremendous":
ATT's focus is really on the user and giving the user the ability to make a decision about whether they want to be tracked or not. And so it's putting the user in the control, not Apple, not another company, but the user, where it should be. And so that's really the focus of it and the feedback that we've gotten from users both before it went live, when it was in the planning stages and so forth, and after has been tremendous. And so we're really standing up on behalf of the consumer here.
