Facebook loses users for the first time in its history

For the first time ever in its 18-year history , Facebook has lost daily users which CEO Mark Zuckerberg believes was caused by the TikTok boom.

‘People have a lot of choices for how they want to spend their time, and apps like TikTok are growing very quickly,’ Zuckerberg said during an earnings call Wednesday, according to the Washington Post.

Facebook reported a drop of nearly 500,000 in daily logins during the last three months of 2021. Zuckerberg reiterated that Meta – the company that owns Facebook, Instagram and WhatsApp – is pushing hard to develop its short-form video Reels in an effort to compete with TikTok.

‘This is why our focus on Reels is so important over the long term,’ he added.

Facebook, which now only has 1.93 billion users logging in each day, also saw its shares plunged more than 20 percent in extended trading on Wednesday after unexpectedly heavy spending on its Metaverse project led to a rare decline in its fourth quarter profit.

Meta saw its stock fall 22.6 percent to $249.90 in after-hours trading, wiping about $200 billion off the company’s market value.

The company heavily invested in its Reality Labs segment – which includes its virtual reality headsets and augmented reality technology – during the final quarter of 2021, accounting for much of the profit decline.

Zuckerberg, who is worth approximately $107 billion, held more than 398 million shares of Meta at the end of 2020, according to Investopedia. Based on his reported holdings, the CEO personally experienced a more than $29 billion loss when the company’s stock fell Wednesday.

Analysts according to Daily Mail reports allege investors had expected signs of declining users growth but were ‘taken aback’ by the amount of ad dollars the company lost in wake of TikTok’s growth.

TikTok is dominating the short-form user-generated video market, despite Meta offering its own Reels product on Instagram.

Data indicates the platform lost consumers to TikTok and  saw lover revenue from ads destined for its short-form videos, according to Bloomberg.