We discussed yesterday how fleeting and short-lived great success can be Can anyone catch Nokia?.

As I was writing this, I had no idea that it was a metaphor for what would happen a few hours later, a coincidental introduction to discussions about another mega-cap technology – META, aka Facebook.

I asked Scott Galloway which of the four companies was most likely to get lopsided, and we (more or less) agreed that it was Facebook. Unlike Microsoft, Amazon, Apple or Google, FB doesn’t have such a durable hold on its user base; This puts its advertising revenue base at risk. META’s moat is much shallower and narrower than other FAANGM firms.

Consider the chart above: Pick In Stock of META That was September 21, 2021 – months before the market itself topped out. It has already fallen 50% from that peak in mid-March to a new low – a full month before Elon Musk’s proposed takeover. my colleague Ben Carlson points out that “Facebook’s market cap has fallen by ~$800 billion since then, a loss in value greater than the current market capitalization of each company in the S&P 500 for Apple, Microsoft, Google, and Amazon. The stock has now underperformed the S&P 500 since going public in 2012.”

Whatever you think of Kasturi, he’s not someone you want to compete with if you can avoid it. He has proven himself to be disruptive, innovative and able to think in ways outside the box. And while Tesla shareholders worry about another shiny object distracting Elon, perhaps Facebook shareholders now realize that in addition to TikTok, starting tomorrow, they have another social media competitor fighting them for ad dollars.

2022 has not been kind to Zuckerberg and company. His net worth has now fallen by over $100 billion YTD.

But it was Zuck’s sketchy respect for its user data or privacy that was once the firm’s biggest source of profit — until Apple decided to step in on behalf of its users. Apple’s move T-boned Facebook’s business model. It wasn’t a fatal blow, but no one walks away unscathed when a big car hits you.

TikTok is stealing users, Apple is breaking their magic data source for advertisers, and now this: an unexpected but brilliant competitor in the same social media space. How much of this has already been reflected in the share price is not known. But I suspect we’ll find out in the next few quarters…

see more:
Mark Zuckerberg is going to kill his company (Ed Zitron, October 26, 2022)

in the past:
Less Than Meets The Eye On Facebook (February 18, 2012)

MiB: Scott Galloway on the Four (October 28, 2017)

Is Tesla stock sick? (October 17, 2022)

Can anyone catch Nokia? (October 26, 2022)

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