Facebook stocks drop 19 percent after falling short of earnings expectations

Facebook stocks drop 19 percent after falling short of earnings expectations

Facebook’s shares dropped more than 19 percent Thursday morning after the company reportedly disappointed analysts with a second-quarter earnings report and warned that its efforts to respond to privacy concerns would curtail growth.

Facebook CEO Mark ZuckerbergMark Elliot ZuckerbergFacebook offers to hand hate speech suspect data to French courts Take a scalpel, not an axe, to 'Big Tech' Bipartisan senators to introduce bill forcing online platforms to disclose value of user data MORE said in an earnings call Wednesday night that the numbers that fell short of estimates could be a sign of things to come for the company.

“Looking ahead, we will continue to invest heavily in security and privacy because we have a responsibility to keep people safe,” Zuckerberg said. “But as I've said on past calls, we’re investing so much in security that it will significantly impact our profitability.”

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The social network has been under the spotlight from lawmakers and regulators for its role in the spread of disinformation and a privacy scandal in which the political consulting firm Cambridge Analytica improperly obtained Facebook data on 87 million users.

Amid the scrutiny of the platform, Zuckerberg has promised to rethink the company’s responsibility to its users. Facebook is also facing stricter privacy rules in Europe and multiple probes into the privacy issue in the U.S.

The drop in stock price Thursday morning erased more than $120 billion in value off Facebook’s market cap.

At the close of trading, the stock was down just under 19 percent.

This story was corrected at 7:41 p.m.