Why Meta Platforms Stock Flopped on Friday


One of the more useful functions of Meta Platforms‘s (NASDAQ: META) core Facebook site is its messaging service. So it wasn’t surprising that the company’s share price fell on news that its messaging will no longer be available as a stand-alone app in a top mobile marketplace in China. Meta’s stock closed Friday more than 4% down in price, which was a far steeper tumble than the 0.9% drop of the S&P 500 index.

Facebook Messenger removed from App Store in China

Before market open, The Wall Street Journal reported that a clutch of popular messaging apps were removed from Apple‘s App Store that day. This included Facebook Messenger, plus Telegram and Signal. The iPhone maker said this was done by request, with rather vague “national security concerns” cited as the reason.

The Journal quoted an unnamed Apple spokesperson as saying that “We are obligated to follow the laws in the countries where we operate, even when we disagree.”

Facebook Messenger, Telegram, and Signal are inaccessible behind the so-called Great Firewall erected by the Chinese government. However, it is common for people in the country to find ways around such restrictions, and messaging apps are popular. The country’s authorities have historically been suspicious of these apps, as they consider them to be conduits of material unfavorable or even threatening to the government.

There is always a way

The removal of Facebook Messenger doesn’t necessarily mean the removal of Facebook from Chinese society. As they always do, users in the massive Asian country will find a way to connect with social media, and if they have Facebook accounts, they’ll probably continue to use them in some fashion — even without Messenger. I don’t think the sudden App Store ban is much of a threat to Meta’s business.

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Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool’s board of directors. Eric Volkman has positions in Apple and Meta Platforms. The Motley Fool has positions in and recommends Apple and Meta Platforms. The Motley Fool has a disclosure policy.

Why Meta Platforms Stock Flopped on Friday was originally published by The Motley Fool

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