Meta Platforms was looking like the best Big Tech stock in the market when the year began. But investors¡¯ fears of legal risks and heavy spending on artificial intelligence are bubbling to the surface, culminating in last week¡¯s 11% rout.
Shares of the Facebook and Instagram parent are down 17% this month, putting them on pace for their worst performance since October 2022. That was when Meta gave a disappointing revenue outlook, and Chief Executive Officer Mark Zuckerberg pleaded with investors to stay patient with the company¡¯s ballooning spending on the metaverse.
Today, Meta is deemphasizing the metaverse to focus on artificial intelligence. But the concerns about runaway spending have only grown. And there¡¯s a rising existential risk surrounding the company after a jury in New Mexico found that Meta misled teenagers in the state about the safety of its social networks, and Meta and Alphabet ¡ª Google¡¯s parent company?¡ª?were found liable in a trial related to social-media addiction. The stock has lost $280 billion in market capitalization in March alone.?
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