Facebook’s stock price plunged deeply on Monday, pulling other technology stocks down with it and threatening a sector that has been among the strongest in the market since President Trump’s election.
The social-media giant’s stock price fell more than 20 percent Wednesday night, after the release of a second-quarter earnings report that indicated lower-than-expected returns and caused at least three Wall Street firms to ax their ratings of the company’s shares. On Thursday afternoon, the stock was down another 18.7 percent, trading at $176.78 per share.
Facebook had previously been the strongest of the five biggest tech stocks, ahead of Amazon, Apple, Netflix, and Google’s parent company Alphabet.
“Facebook’s second-quarter results and outlook are disappointing, but ‘startling’ is probably a better word. We think few, if any, anticipated this kind of reset,” said major Wall Street analyst J.P. Morgan.
The information-technology sector has seen the most gains since Trump’s election. Facebook stock has soared 80 percent in Trump’s first term, while overall, IT stocks on the S&P 500 have gained 63.8 percent.
Facebook’s troubles mushroomed earlier this year with the revelation of several data breaches that had compromised at least 87 million users‘ personal information. The company spent the spring doing damage control on both the technological and public-relations fronts, with founder and CEO Mark Zuckerberg testifying to Congress and promising to do a better job protecting users’ data.