Facebook ad boycott wipes billions off market value
June 29, 2020 - A growing number of companies have pulled advertising from Facebook following the “Stop Hate for Profit” campaign to crack down on hate speech and misinformation on the social media platform.
Civil rights groups launched the campaign following the death of George Floyd, an unarmed black man killed by Minneapolis police on May 25.
Shares in Facebook were poised to fall for a second day after more high-profile businesses, including coffeehouse giant Starbucks and British-based drinks company Diageo, joined the growing number of brands planning to halt spending on social media.
Shares continued to slide by 2.2% in early trading before markets in New York opened on Monday, adding to Friday‘s 8.3% decline after Unilever said it would stop ad spending on Facebook for the rest of the year.
By opening on Monday (June 29), Facebook’s fall in stock price had wiped out $72.5 billion in market value and shaved the net worth of Chief Executive Officer Mark Zuckerberg by more than $8bn.
Facebook generated $17.7bn in revenue in the first quarter, including $17.44bn from advertising. Civil rights groups say they expect more corporations to join the boycott, as peer pressure rises. Combined with the pandemic-fuelled economic crisis, the threat to Facebook mounts.
The current publicity around Facebook’s hate speech policies and Zuckerberg’s lack of action on misinformation continues to damage its perception and stock.
EDITORS: June 30, 2020: Please note that the Ad spending in the graphic at the bottom of this graphic relates to the total advertising spend in the U.S. in 2019 (not the spending on Facebook only) . The link to the source of this data was updated after the graphic was created. Please use GN40328