Meta in the “whirlpool of death” (Part 2): Zuckerberg’s bet

Jake Dollarhide, CEO of Longbow Asset Management in Tulsa, Oklahoma, said that Mark Zuckerberg and Facebook have always known how to get through the most difficult times in history. Before going public in 2012, he recalled, Facebook was also struggling as investors left and mocked the company’s ability to move “from PC to mobile world.” “.

But then, within two years, the company turned the tide. Facebook’s sales grew 72% in the first three months of 2014 and profits tripled after they were restructured to be mobile-first. That successful transition became part of their legend and also the foundation of their later domination.

Zuckerberg’s success in moving to mobile has given experts confidence that Meta can monetize the move to the metaverse for the time being. In the second quarter of this past quarter, Meta’s Reality Labs division, which hosts virtual reality headsets and related technologies, generated $452 million in revenue, about 1.5% of total Meta sales, and lost 2. ,8 billion USD.

One thing is for sure, however, that whatever happens in the next two or even three years, Zuckerberg has made it clear that the future of the company is in the metaverse, where he will focus on businesses. newly formed around virtual reality.

But, Ben Zhao, a computer science professor at the University of Chicago, thinks there’s a lot of uncertainty surrounding the metaverse’s prospects. “ The real question is, are everyday users ready for the metaverse? “Zhao said. “ Is the underlying technology ready and mature enough to make that transition seamless?

The last time Facebook’s market cap was this low was in early 2019, as the company was dealing with the continuing fallout of the Cambridge Analytica privacy scandal. Since then, Facebook has suffered further reputational damage, most notably from documents leaked last year by accuser and former employee Frances Haugen.

In fact, even before changing its name to Meta, Facebook was considered a controversial platform, some US senators compared the company to Big Tobaco, the big and influential tobacco companies. harmful to humanity.

Plus, Mark Zuckerberg himself isn’t a serious leader about changing company culture, changing himself, and creating the company he envisions. This has hurt the company’s ability to recruit top talent, in stark contrast to a decade ago, when it was considered the premier destination for top engineers in the industry.

A former Facebook advertising executive, who declined to be named, shared that, at the moment, TikTok is owned by ByteDance China, which has an advantage over Meta when it comes to recruiting talent.

It can be said that at the present time, Meta’s business is threatened on many fronts. The user base is stagnant and shrinking, and the core advertising business is also being challenged by the operating system changes made by Apple. And a series of scandals have put the company under the microscopes of regulators, limiting its ability to continue to grow through mergers and acquisitions.

But, when Zuckerberg ‘s bet on mobile 10 years ago paid off, Zuckerberg was right. Will Meta’s stock price from the depths of 2022 break through the death spiral 10 years later? Of course, everything is probably still a guess, but along with Zuckerberg, a man who always thinks long-term, anticipates the threat of the future, no one has dared to say that Meta cannot return.

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