Meta CEO Mark Zuckerberg’s net worth dropped by more than $22 billion, or 13%, on Thursday as shares of the company slumped following its first-quarter earnings call, which exceeded expectations but predicted slow growth. Meta shares fell more than 13% to 426.47, with Zuckerberg’s net worth at $151 billion at around 11:15 a.m. ET, down $22.1 billion for the day. The company projected lower-than-expected second-quarter sales and anticipated heavy costs in its artificial intelligence division with no clear path to operating profits.
Zuckerberg is still the fourth richest person in the world, behind Bernard Arnault, Jeff Bezos, and Elon Musk. Meta earned $36.46 billion in sales during the first quarter of 2024, exceeding estimates of $36.14 billion, up 27% from the previous year. Facebook co-founder Dustin Moskovitz’s net worth also fell by $2 billion, or 11.63%, to $15.8 billion according to Forbes’ calculations, ranking him 103rd on Forbes’ billionaires list.
The earnings call emphasized Meta’s focus on developing AI capabilities, showcasing the company’s new AI chatbot, Llama 3. Despite planned investments in AI technology, Meta remains primarily an advertising company, with ads accounting for 99% of its revenue. The massive planned investments in AI, combined with slower growth projections for the second quarter, caused concern among investors and led to the sharp decline in share prices. Zuckerberg expressed confidence in Meta AI becoming the most used and best AI assistant in the world, despite the company scaling the product before it becomes profitable.
Despite the drop in stock prices, Meta’s first-quarter earnings exceeded estimates as the company continues to focus on expanding its AI capabilities. Zuckerberg’s net worth decline does not impact his position as one of the world’s wealthiest individuals. The company’s emphasis on AI technology and planned investments may have spooked investors, but Zuckerberg remains optimistic about the long-term value of Meta’s AI initiatives. The launch of Llama 3 and other AI projects demonstrate Meta’s commitment to innovation, despite short-term financial challenges. Investors will be closely watching future developments and the impact of Meta’s AI investments on the company’s overall performance.
