Meta Stock Plummets 25%... Zuckerberg's 142 Trillion Won Wealth Vanishes Amid Metaverse Obsession

Zuckerberg Optimistic "Metaverse Will Ultimately Be Effective"
Investors Request Workforce Cuts and Reduced Metaverse Investment

Mark Zuckerberg, CEO of Meta. Photo by AFP Yonhap News

[Asia Economy Intern Reporter Lee Gyehwa] Meta Platforms (hereafter Meta) saw its stock price plunge nearly 25% due to poor earnings. On the 27th (local time), Bloomberg reported that as Meta, the parent company of Facebook, experienced a sharp decline in stock price this year, CEO Mark Zuckerberg's wealth evaporated by more than $100 billion (approximately 142 trillion KRW). However, Zuckerberg remains optimistic about the metaverse (3D virtual world) business, drawing criticism from investors.

According to the Bloomberg Billionaires Index, Zuckerberg's personal fortune currently stands at $38.1 billion. This is a decrease of over $100 billion from the record high of $142 billion in September 2021. On the same day, Meta's stock price on the New York Stock Exchange closed at $97.94, down 24.56% from the previous trading day after earnings fell short of Wall Street expectations.

The 38-year-old was once ranked third on the Bloomberg Billionaires Index, following Elon Musk, CEO of Tesla, and Jeff Bezos, founder of Amazon. However, due to Meta's stock plunge, he has fallen to 23rd place.

Zuckerberg expressed confidence that long-term investments in the metaverse would yield greater returns over time. However, Meta's revenue declined in the third quarter compared to the same period last year, following a decrease in the second quarter. The third-quarter net profit was $4.4 billion (approximately 6.2612 trillion KRW), less than half of the $9.2 billion net profit in the third quarter of last year.

Meanwhile, losses in the Reality Labs division, which includes the metaverse business, expanded to $9.4 billion (approximately 13.3762 trillion KRW) through the third quarter. Zuckerberg explained the poor performance by stating, "Meta is facing many challenges, including a sluggish economy, Apple's iOS privacy updates that have made advertising to users more difficult, and competitors like TikTok."

He added, "We will address these issues well, and those who are patient and invest with us will eventually be rewarded." He further explained, "One reason for investing in the metaverse is to own a platform that is not negatively affected by decisions from competitors like Apple."

However, amid repeated stock declines, investors are requesting Meta to reduce its metaverse investments. Brad Gerstner, CEO of hedge fund Altimeter Capital, sent an open letter to Meta proposing a 20% workforce reduction and cutting metaverse business investments to below $5 billion (approximately 7.1 trillion KRW) annually. As of June, Altimeter Capital holds 2 million shares of Meta stock, about 0.1% of Meta's total shares.

Altimeter Capital specifically argued that investments in the metaverse business should be cut by more than half. Gerstner said, "People don't even really understand what the metaverse means," and "Investing over $100 billion in the metaverse is too large a scale, even by Silicon Valley standards."

Last October, Meta changed its name from Facebook to Meta and announced plans to invest about $100 billion over 10 years, allocating $10 billion annually to the metaverse.

This content was produced with the assistance of AI translation services.