Over the past 10 days since the Cambridge Analytica scandal was first made public, Facebook has faced a market loss of about $75 billion. This shouldn’t come as a surprise as the company is facing its worst ever month.
Talking strictly in terms of numbers on March 16, when Facebook first acknowledged the irregularities in data sharing with Cambridge Analytica, the company’s stocks were trading at $185.06. Today, they’re at $159.70.
As a result, over this period, the market cap of the company has dipped from $537.59 billion to $463.93 billion. This is a downfall of 13.7% in shares and market cap.
Things aren’t going to get better very soon for the company as the United States Federal Trade Commission (FTC) has confirmed that it’s formally investigating Facebook over recent press reports of privacy issues.
“The FTC is confirming that it has an open non-public investigation into these practices,” said Tom Pahl, acting director of the FTC’s Bureau of Consumer Protection.
There are good chances that FTC will look into if Facebook took steps to violate a 2011 consent decree in which the company promised not to share user data without consent. If FTC finds the social network at fault, each violation could result in $40,000 fine. Theoretically, it could go as high as $2 trillion.
As a result of this scandal, the company is also facing the threat of losing advertisers. Companies like Mozilla, Pep Boys, Commerzbank have already canceled all their advertising.
Meanwhile, Facebook’s founder and CEO, Mark Zuckerberg went on an interview spree last week and tried to do damage control. He has promised to bring some significant changes to the platform in the upcoming months.
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