Business
Facebook Parent Meta Sheds $200bn In Stock Plummeta
Facebook’s parent firm Meta on Thursday plunged over $200 billion in stock value — comparable to the size of New Zealand’s economy — after results that raised doubts about the troubled social media giant’s future.
In addition to costs of big investments on its metaverse vision for the internet and trouble for its core ads business, the firm predicted slower growth and even reported its first dip in daily users globally on the signature Facebook platform.
Facebook has long been marked by an insatiable push for growth, and now has nearly two billion daily users, but the results laid bare the challenges facing the social media giant on several fronts.
Shares have been down about 25 percent since shortly after the opening in New York, resulting in a more than $200 billion hit to the company’s market value.
“It was a disaster quarter for Facebook and clearly they have some major headwinds over the next year,” Wedbush’s Dan Ives said.
Facebook founder Mark Zuckerberg had some $25 billion in value wiped from his personal holding by the rout on Wall Street, according to filings on the company stock he owns.
Risk of not growing
Meta, which also owns Instagram and WhatsApp, has noted that it faces fierce competition for young users from the likes of explosively growing short-form video platform TikTok.
Ahead of results, analysts expected 1.95 billion daily active users on Facebook, but Meta reported 1.93 billion — a key indicator for where the platform is headed.
On the financial side, Meta reported a turnover of $33.67 billion, in line with its forecasts, but it made $10.3 billion in net profit in the fourth quarter, eight percent less than last year.
Investors also recoiled at Facebook’s report of losing roughly one million daily users globally between the last two quarters of 2021 — a fraction of the total but a potential signal of stagnation.
“It’s the first time the user base is shrinking,” said analyst Adam Sarhan from 50 Park Investment. “If the company is not growing, then it’s a complete reset for investors.”
It is essential to note Meta is a still massive and growing on the whole — as 2021 closed, 2.8 billion people used one of its four platforms and messenger services at least once a day, and 3.6 billion at least once a month.
One way out of Meta’s troubles would be to acquire the next big thing in social media, as it has done previously.
But the company is under considerable scrutiny from US regulators after the damning allegations that emerged from its whistleblower crisis last year.
The internal documents leaked by ex-worker Frances Haugen highlighted accusations that executives prioritized growth over keeping their billions of users safe.
However, Thursday’s dramatic sell-off is the latest to confront a Big Tech firm after a similar liquidation of Netflix shares last month, though the streaming giant has somewhat rebounded since.
Other tech giants such as Apple and Google parent Alphabet have rallied after results — though they both recently posted excellent numbers that calmed jittery markets.
Stocks have risen the last four days as the markets try to rebound from a bruising January pressured by worries over shifting US Federal Reserve policy and uncertainty over the crisis in Ukraine.
But the sharp fall in Meta and some other tech names “is raising doubts about the sustainability of the broader rebound effort,” said Briefing.com analyst Patrick O’Hare.
Banking
Theparkpay Technologies Limited Strengthens Global Payments Infrastructure with UK FCA Licence
TotalEnergies and Nigerian independent energy company AMNI International have taken the Final Investment Decision on the $800 million Ima Gas Project, more than five decades after the gas field was discovered.
The Ima Gas Project, located in shallow waters across Oil Mining Leases 112 and 117 near Bonny Island, Rivers State, is expected to begin production in 2028 and reach a plateau of 350 million cubic feet of gas per day.
The development is expected to play a major role in supplying feed gas to Nigeria LNG, with the Ima field projected to provide about one-third of the additional gas required for the ongoing Train 7 expansion.
Train 7 is expected to increase Nigeria LNG’s liquefaction capacity from 22 million tonnes per annum to 30 million tonnes per annum, strengthening Nigeria’s capacity to process and export liquefied natural gas.
The Ima field was discovered in 1973 but remained undeveloped for more than 50 years. The Final Investment Decision provides the commercial and financial basis for finally developing the long-dormant resource.
Under the development plan, TotalEnergies will operate the project with a 40 per cent interest, while AMNI will hold the remaining 60 per cent.
The field will be developed using a single offshore platform connected to Nigeria LNG’s facility on Bonny Island through a 22-kilometre pipeline.
TotalEnergies said its investment in the project is more than $600 million, while the Federal Government described the overall Final Investment Decision as an $800 million investment.
At the FID signing ceremony in Abuja, TotalEnergies Exploration and Production Nigeria Managing Director, Mathieu Bouyer, described the decision as the culmination of a development process that had stretched across several decades.
He said the project reflected increased confidence in Nigeria’s investment environment and highlighted reforms targeting the non-associated gas sector as part of the factors that helped make the development commercially viable.
President Bola Tinubu welcomed the investment, saying the project demonstrated the potential of reforms introduced to reduce the cost and time required to develop oil and gas projects.
The President said the government had introduced incentives aimed specifically at unlocking onshore and shallow-water gas projects that had remained undeveloped for years.
He said the Ima development would create opportunities for Nigerian businesses, engineers, technicians and contractors, while generating jobs, economic activity in host communities and additional export earnings.
The project is also expected to have a strong Nigerian content component. TotalEnergies said all key contractors for the development would be Nigerian companies, while about 60 per cent of the workforce during the development phase is expected to come from host communities.
The development will incorporate measures aimed at reducing emissions. TotalEnergies said the platform would receive electricity from shore, operate without routine flaring and use permanent methane detection and monitoring systems.
The Federal Government said the project is part of efforts to turn Nigeria’s large natural gas reserves into productive assets capable of supporting industrialisation, energy supply, jobs and export earnings.
Special Adviser to the President on Energy, Olu Verheijen, said the Ima development illustrated the importance of creating commercial and investment conditions that allow previously stranded resources to be developed.
The government also noted that Nigerian financial institutions arranged 77 per cent of the project’s financing, further highlighting the participation of domestic financial institutions in the development.
For Nigeria LNG, the project comes as the company continues work on the Train 7 expansion, which is designed to increase the Bonny Island plant’s liquefaction capacity and strengthen the country’s position in the global LNG market.
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