Facebook–owned Meta Platforms witnessed first-ever fall in daily active users (DAUs) in the December quarter, triggering a selloff in shares of the social media giant.

The tech giant's stock price plunged over 26% on Thursday, wiping out more than $200 billion off its market value.

Facebook's global daily users declined to 1.929 billion in the quarter ended December 2021, compared with 1.930 billion in the previous quarter. The company has lost users for the first time in its 18-year history.

Chief executive Mark Zuckerberg blamed the decline in numbers on competitor TikTok's popularity. "TikTok is such a big competitor already and continues to grow at quite a fast rate off of a very large base. We're optimistic about the future with Reels, but there's a lot of work to do," Zuckerberg said in an earnings call.

Meta said it was hit by privacy changes on Apple's operating system, which made it difficult for brands to target and measure their ads on Facebook and Instagram.

The impact of Apple's privacy changes could be "in the order of $10 billion" for 2022, Meta chief financial officer Dave Wehner told analysts in the conference call.

Meta's overall revenue rose 20% year-on-year in the quarter ended December 2021 to $33.67 billion. The company expects total revenue in the first quarter of 2022 to be in the range of $27-29 billion.

The social media giant expects year-over-year growth in the first quarter to be impacted by headwinds to both impression and price growth.

“On the impressions side, we expect continued headwinds from both increased competition for people's time and a shift of engagement within our apps towards video surfaces like Reels, which monetize at lower rates than Feed and Stories,” says Meta's chief financial officer Dave Wehner.

On the pricing side, the company expects growth to be negatively impacted by a few factors. “First, we will lap a period in which Apple's iOS changes were not in effect and we anticipate modestly increasing ad targeting and measurement headwinds from platform and regulatory changes. Second, we will lap a period of strong demand in the prior year and we're hearing from advertisers that macroeconomic challenges like cost inflation and supply chain disruptions are impacting advertiser budgets. Finally, based on current exchange rates, we expect foreign currency to be a headwind to year-over-year growth,” says Wehner.

On the company’s drop in user growth, Wehner said the social network is seeing an impact from competition, particularly among younger audiences. He also cited an increase in internet data prices in India as one of the reasons for the slowdown. Meta has around 350 million users in India, which is also its biggest market.

Meta expects total expenses in 2022 to be in the range of $90-95 billion, driven by investments in technical and product talent and infrastructure-related costs.

Its headcount rose 23% year-over-year to 71,970 as of December 31, 2021.

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