Meta’s Stock had a Rough February (2022), is Facebook’s Push for the Metaverse to Blame?

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By Michael Inouye | 1Q 2022 | IN-6469

 

Meta Platforms' Stock Down 20% YoY at Close of February 2022

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Meta’s stock has taken a beating, dropping nearly 38% of its value at the close of February 2022, just two months removed from the start of the year (Jan 3, 2022)—Meta’s stock is down 44% from a peak in September 2021. Meta’s recent rebranding to reflect its emphasis on the metaverse has led some to question if investors are already souring on the prospects of the metaverse or, alternatively, questioning the company’s ability to profit from this trend. Given the relative proximity of Facebook’s Meta rebranding (announced October 28, 2021) to the change in stock price, one could argue for a cause and effect, but the metaverse play isn’t likely the reason for Meta’s stock declines. Even if there is some negative impact, the reaction to the metaverse play isn’t nearly as significant as Meta’s other problems.  

Meta is facing substantial pressures on several fronts which have contributed far more to the stock declines than a rebrand and focus on the metaverse. These pressures extend to:

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