Out of all the social media tech giants on the market, Facebook (NYSE: FB) has arguably been hit the hardest so far this year. Besides the ongoing regulatory scrutiny that almost all social media companies are facing nowadays, Facebook has been on the receiving end of a significant advertising embargo from other companies. To make matters worse, one of Facebook’s top executives is now stepping down from his role in the company.
The Wall Street Journal went on to report that Facebook’s chief marketing officer (CMO), Antonio Lucio, is now leaving the company, with his last day set for September 18th. He had first joined up with Facebook back in 2018 from his previous position in HP, where he also served as the company’s CMO.
During his time at Facebook, his primary focus was to help rebrand the company to become more trustworthy amidst various criticism surrounding private data usage. For many years, Facebook has been called out for how it supposedly handles its user’s data. Lucio’s role was to address these issues and try to transform the company’s tarnished image for the better.
“There’s no question we made mistakes and we’re in the process of addressing them one after the other, but we have to tell that story to the world on the trust side as well as on the value side,” said Lucio in a statement last year in regards to his role. His departure is seen as a pretty bad sign for Facebook by many investors and analysts, especially given the recent increase in scrutiny from regulatory bodies around the world.
The most notable example of this was a congress hearing earlier this summer, where the CEO’s of Amazon, Apple, Facebook, and Google were all present together for the first time in history. The hearing saw lawmakers rigorously question the CEO’s on their company’s role in modern society.
Shares of Facebook are down around 1% in light of the news, but it’s unlikely to move any farther than this on Monday. So far this year, Facebook is up around 30%, which is pretty much in line with most major indexes in the U.S. However, Facebook’s stock has been significantly outperformed by companies like Amazon, although it has done much better than Google so far this year.
Facebook Company Profile
Facebook is the world’s largest online social network, with more than 2 billion monthly active users. Users engage with each other in different ways, exchanging messages and sharing news events, photos, and videos. On the video side, the firm is in the process of building a library of premium content and monetizing it via ads or subscription revenue. Facebook refers to this as Facebook Watch. The firm’s ecosystem consists mainly of the Facebook app, Instagram, Messenger, WhatsApp, and many features surrounding these products. Users can access Facebook on mobile devices and desktop. Advertising revenue represents more than 90% of the firm’s total revenue, with 50% coming from the U.S. and Canada, and 25% from Europe. With gross margins above 80%, Facebook operates at a 40%-plus margin. – Warrior Trading News
