Facebook Inc.’s stocks plunged as much as 24 percent as it reported on Wednesday slow-than-expected revenue growth in the second quarter hit by the privacy scandal.
The social media giant also warned the future revenue expansion could continue to slow down, spreading selloff to other tech stocks.
This report revealed the company’s first full quarter financial performance since the scandal broke over its privacy loophole and misconducts. Facebook has been forced to adjust its corporate culture under turmoil and tightened public scrutiny by lawmakers, regulators and the press.
The company had also recorded a minimal slide of daily active users (DAU) in Europe, amid the newly launched regulation on data protection (GDPR) by the European Union.
Facebook said on Tuesday it had received approval to open a subsidiary (“Innovative Hub”) in the eastern Chinese city Hangzhou where hosts the headquarter of the e-commerce giant Alibaba, as the company has been long seeking to re-step into the world’s second largest economy since its social media business got blocked by the Chinese authorities.
But the permission was “quickly” pulled down from the government’s corporate registration the next day, probably due to dissensions among different levels of governments on its latest effort, reported by the U.S. newspaper New York Times.