Billionaire Musk Ranks 3rd, Zuckerberg 4th... Tesla Up - Meta Down, Mixed Fortunes

Meta Drops 10%, Net Worth Evaporates by 25 Trillion Won
Tesla Up 5%, Rising for Third Day
Musk Surpasses Zuckerberg in Net Worth

Mark Zuckerberg, CEO of Meta Platforms, has relinquished the title of the world's third-richest billionaire to Elon Musk, CEO of Tesla. This came as a result of Meta's stock plummeting despite better-than-expected earnings. Tesla's stock has continued its three-day rally.

According to a Bloomberg report on the 25th (local time), Zuckerberg's net worth decreased by $18 billion in a single day, marking the 11th largest daily loss in stock-related assets ever. Zuckerberg's current net worth is estimated at $157 billion. On the same day, Musk's net worth increased by $5.8 billion, reaching $184 billion.

[Image source=AFP Yonhap News]

This reversal in asset rankings was driven by the divergent stock performances of the two companies. Meta closed at $441.38, down 10.56% from the previous session, despite exceeding market expectations in New York trading. The intraday drop even reached -15%. Its market capitalization also evaporated by nearly $140 billion (approximately 190 trillion KRW).

US financial media CNBC pointed out that Meta's Q2 guidance fell short of market forecasts, and the burden of billions of dollars in future investments in artificial intelligence (AI) and the metaverse intensified investor concerns.

In its earnings announcement the previous day, Meta estimated Q2 revenue to be between $36.5 billion and $39 billion. The midpoint ($37.75 billion) represents an 18% increase compared to the same period last year but falls short of the market estimate of $38.3 billion. Capital expenditures for this year were also revised upward from $30 billion?$37 billion to $35 billion?$40 billion. Meta CFO Susan Li explained, "We are aggressively investing in ambitious AI research and product development, and capital expenditures will continue to increase next year."

As a result, investment firms have been lowering Meta's target stock prices one after another. Bernstein maintained Meta's investment rating but lowered the target price from $590 to $565. Bernstein commented, "Meta's current business strategy is costly, and it will take a long time to recoup profits." Additionally, JP Morgan revised its target price from $535 to $480, and Barclays adjusted theirs from $550 to $520.

Meanwhile, Tesla's stock closed at $170.18, up 4.97% from the previous session. This marks a three-day consecutive rise since the Q1 earnings announcement on the 23rd. Although Tesla's Q1 results significantly missed market expectations, the company eased investor concerns by expressing confidence in future business, including the launch of a low-cost electric vehicle model.

On Wall Street, some analysts believe Tesla's stock has hit bottom. Ron Baron, chairman of Baron Capital and a billionaire investor on Wall Street, told CNBC in an interview, "Tesla's stock is at the bottom now," adding, "It will rise tremendously going forward." He further noted, "Tesla could ultimately generate revenue by selling fully autonomous driving technology to other automakers."

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