This week in Facebook

One of the more perplexing things about Facebook's ongoing privacy fiasco was its lack of impact on FB's share price. No matter how bad things looked on the PR front, no matter how many class action lawsuits were working their way through courts in various jurisdictions, no matter how many different jurisdictions announced new or intensified investigations (or fines), FB's stock price just kept on rising, and Mark Zuckerberg's personal net worth along with it. It was Bizarro World's version of the Invisible Hand, in which markets simply didn't care about the obviously looming costs of FB's mounting woes.

Well, today, that finally came to an end, mainly because Facebook themselves finally decided that SEC rules required them to throw some cold water on it all. As reported by Reuters, via EWN:

Facebook Inc’s shares lost as much as a quarter of their value on Wednesday after executives said that profit margins would plummet for several years due to the costs of improving privacy safeguards and slowing usage in the biggest advertising markets.

The second-quarter results were the first sign that a new European privacy law and a succession of privacy scandals involving Cambridge Analytica and other app developers have bit into Facebook’s business. The company further warned that the toll would not be offset by revenue growth from emerging markets and Facebook’s Instagram app, which has been more immune from privacy concerns.

Facebook's fortunes shifted in under two hours as the company first reported revenue and user growth that missed expectations and then issued warnings about future growth and expenses.

[...]

The plummeting stock price wiped out as much as $150 billion in market capitalisation and erased the stock’s gains since April when Facebook announced a surprisingly strong 63 percent rise in profit and an increase in users.

It's. About. Damn. Time.

I do feel some sympathy for people whose pension plan managers have been buying Facebook stock over the last year, apparently oblivious to the gathering storm.  They're taking a bath on FB stock right now, due entirely to decisions they had no hand in making, which sucks. For the greedy speculators, though, who have been watching all of FB's floundering for months and still managed to give zero fucks about FB's issues as long as they could convince themselves that profits (and dividends) would continue to flow? They can fuck themselves.

Facebook are gigantic, with enormous cash reserves; they can afford to lose money for a while yet, before it really starts to hurt them. But with their share price finally dropping, raising the possibility of maybe some pressure, finally, from shareholders, we may be about to see Facebook start tackling the root causes of their problems, i.e. their corporate culture, rather than just paying PR lip service to the idea of reforming themselves (but no regulations, please).

Here's hoping, anyway.