Facebook, led by Mark Zuckerberg now has a market value of over $1 trillion, all credits to a 4.2 percent hike in its share price on Monday. It has achieved this milestone faster than any other technology firm. The rise came alongside a judge’s dismissal of two complaints against Facebook filed by the Federal Trade Commission (FTC) and state attorney generals alleging monopolistic practices. It has joined the ranks of companies valued at over a trillion dollars. The company’s market cap is sitting at $1.008 trillion, putting it over the mark for the first time in its history.
Some of the most notable Facebook divisions are the Facebook site itself, along with Messenger, including Instagram, WhatsApp, and Oculus. US tech companies that have passed the $1 trillion valuation mark, it is the only one that was founded in the 2000s, making it the newest — as long as you’re counting from the date that Google was started (1998), instead of Alphabet (2015). Its share price has seen a 30 percent increase this year owing to the pandemic and people’s increased dependency on its offerings including WhatsApp and Instagram. This has helped people to stay in touch with friends and conduct business during the COVID-19 pandemic. Facebook’s share price went up by 4.2 percent to $355.64 on Monday. This was the highest increase in the past two months.
Interestingly, only a handful of American tech companies have managed to cross the magical 13 digit valuation threshold. Apple achieved the feat three years ago; subsequently, it was joined by Alphabet Inc., Amazon, and Microsoft in the big league. Meanwhile, Facebook is the youngest company to achieve the milestone valuation just 17 years after Zuckerberg co-founded the company in 2004. It is reported that Monday’s jump in share price can be attributed to the dismissal of two complaints against it by a judge. The complaints were filed by the FTC and 46 state attorneys general in December alleging that Facebook’s size as a company has resulted in consumer harms including reduced product quality, thereby amounting to anti-competitive behavior.
The complaints were dismissed because the FTC failed to establish that Facebook has a monopoly in the social networking sector. The agency’s claim that Facebook controls over 60 percent of a vaguely defined market was deemed “too speculative and conclusory to go forward.” The FTC is allowed to refile the complaint within 30 days. Nevertheless, investors’ interest in the social media giant shows no signs of diminishing.
The company suffered a huge drop of 19% in 2018 after posting disappointing revenue and user figures for the second quarter of that year. That drop came amidst a number of scandals that year, including data leaks, fake news, and, most notably, the Cambridge Analytica scandal — in which a data firm improperly accessed the data of 87 million users and used it to target ads for Donald Trump in the 2016 presidential election. Despite all the scandals, it was able to bounce back and has continued to grow its user base and steadily increase its average revenue per user.