Here are five tech giants that have been brought to their knees this year.
(All figures are as of market close on Thursday.)
Coinbase: down 71.72% in 2022
A sell-off in crypto assets has triggered a huge drop in the market value of the largest US cryptocurrency exchange in 2022.
Late on May 10, Coinbase reported a first-quarter loss and 27% lower revenue than a year ago, missing Wall Street’s forecasts. The following day, Coinbase shares plummeted more than 25% to hit their lowest level ever. Its shares lost more than half their value in that week alone — from $130.15 on May 4 to $53.72 on May 11.
The stock has recovered slightly since then but is still at $69.70, down almost 72% in 2022, and 81.1% down from its all-time high of $368.90 in November 2021.
Founder Brian Armstrong, who had a personal fortune of $13.7 billion in November and about $8 billion at the end of March, is now worth under $3 billion.
Snap: down 68.21% in 2022
Late on May 23, Snap CEO Evan Spiegel warned that “the macroeconomic environment has deteriorated further and faster” than it anticipated in its earnings guidance on April 21.
In the filing, Snap said it expected revenues and adjusted earnings to fall “below the low end” of its guidance range in the second quarter of 2022, ending June.
The following day, Snap’s shares plunged 43%, their biggest intraday decline ever, falling below the 2017 IPO price of $17.
The sell-off erased almost $16 billion in market value and dragged down Snap’s larger peers, including Meta, Alphabet, Twitter and Pinterest.
Social media stocks lost more than $135 billion in market value that day, and the tech-heavy Nasdaq dropped about 2.4% to 11,264.45.
Netflix: down 67.96% in 2022
Shares of Netflix tumbled 39% on April 20 after it reported a sharp decline in its subscriber base. The stock fell as low as $212.51 in New York, down 64% this year, making it the worst-performing stock on the S&P 500 and Nasdaq this year.
The streaming service shocked Wall Street, saying it lost 200,000 customers in the first quarter – the first time it has shed subscribers since 2011. It also projected it would lose another two million customers in the second quarter.
In its earnings report, the company said the war in Ukraine and the decision to raise its prices in the US had hit subscriber numbers. Pulling out of Russia alone had cost it 700,000 members, Netflix said.
About a month later the company laid off 150 employees – about 2% of its North American workforce – mainly in its office in California. It said the job cuts were due to a drop in revenue.
Though the stock has fallen further and is now down almost 68%, it has been dethroned by Coinbase and Snap as the biggest loser of 2022.
Sea Ltd: down 64.38% in 2022
On February 16, Sea Ltd. lost more than $16 billion of value after its shares plummeted 18% — their biggest one-day drop – on reports that India had abruptly banned its most popular mobile gaming title, Garena Free Fire, along with 53 other apps linked to China.
India has banned hundreds of Chinese apps over the past two years, but the inclusion of Sea’s app took everyone, including the company, by surprise. While Sea is based in Singapore, its founders are Chinese-born. The company is also backed by the Chinese technology and entertainment firm Tencent.
Shares of Sea plunged another 13% in US trading on March 1, after the company reported an earnings miss in its fourth-quarter data, wiping out $1.1 billion of chairman Forrest Li’s net worth.
On May 18, Sea’s shares jumped 14% after its first-quarter revenue beat analysts’ expectations, but the stock is still down more than 64% this year.
Meta: down 43.4% in 2022
Shares of Facebook’s parent company Meta Platforms crashed more than 25% on February 3, the biggest single-day slide in market value for a US company, after the social media giant issued a dismal forecast, blaming Apple’s privacy changes and increased competition.
The huge drop, erasing over $200 billion from Meta’s market capitalization and around $29 billion from Chief Executive Officer Mark Zuckerberg’s net worth, spilled over to the broader technology sector and dragged the Nasdaq Composite Index lower.
It marked the company’s worst one-day loss since its Wall Street debut in 2012.
Meta’s rallied on April 28 posted its slowest revenue growth in years and narrowly missed analysts’ predictions for daily and monthly active Facebook users. Its profits, while ahead of expectations, were down 21% from the same period a year ago. Amid the broader downturn, weary investors found something to celebrate after this decidedly mixed news, sending Meta’s shares soaring 18% in after-hours trading.
Meta’s shares are still down 43.4% this year – a stunning number for a company with a market cap of around $935 billion on January 1.
Top Stories By Our Reporters
Tesla will not manufacture in India unless it is allowed to sell, service cars: Elon Musk
Tesla will not make cars in India until it is allowed to sell in the market first, Elon Musk tweeted. Musk’s tweet was in response to a user who asked about the company’s India manufacturing plans. “Tesla will not put a manufacturing plant in any location where we are not allowed first to sell & service cars,” he tweeted.
Delhivery IPO
Volatile markets left us nervous before listing, says Delhivery CEO
Delhivery’s top management was “nervous” ahead of its listing on Tuesday due to uncertain investor sentiment but were never “really concerned” about the issue not being fully subscribed, cofounder and chief executive Sahil Barua told us after the listing.
Delhivery’s market debut more than doubles SoftBank stake value to $1B: Amid a global rout in tech stocks, Delhivery’s market debut turned out to be one of the best by a SoftBank-backed firm this year. In 2019, SoftBank invested about $390 million in two tranches in Delhivery. That investment is now worth almost $1 billion based on Delhivery’s stock price after its first day of trading. SoftBank holds close to 19% in Delhivery.
Ecommerce corner
Swiggy eyes e-commerce foray through Mini marketplace
Swiggy is planning to enter the ecommerce space. It is working on a marketplace to onboard local stores and direct-to-consumer (D2C) brands and the pilot is already underway, multiple people aware of the matter told us. The platform is called Minis. There are select brands and merchants with whom Swiggy is testing this out.
Google in talks to partner with ONDC, following Amazon, Reliance and Flipkart: Google is in active discussions with the government-backed Open Network for Digital Commerce (ONDC) and is “exploring” ways to partner with the ambitious initiative, multiple sources told us. The “exploratory” talks have spanned various businesses within Google, including search and payments, one of the sources said, adding “there is a definite interest” from Google in engaging with the ecommerce network.
Flipkart forays into home services to rival Urban Company: Ecommerce firm Flipkart has quietly
entered the home services business, starting with AC servicing, sources told us. The company is providing the service through Jeeves, an after-sales services company it acquired several years ago. Flipkart’s home services business is likely to also include washing machine repairs and other similar offerings going forward.
Nykaa’s consolidated net profit falls 57.65% YoY in Q4: FSN E-Commerce Ventures, the parent company of omnichannel beauty retailer Nykaa, reported a 57.65% drop in its consolidated net profit to Rs 7.5 crore for the fourth quarter that ended March 31, 2022, from Rs 17.9 crore in the same quarter last year. Meanwhile, Zomato said on Monday that net losses in the fourth quarter of FY22 stood at Rs 359.70 crore, a 2.5x jump from Rs 134 crore in the same quarter of FY21. It had reported a net loss of Rs 67.20 crore in the third quarter of FY22.
Invact Metaversity saga
Cofounder Manish Maheshwari agrees to leave Invact Metaversity
Manish Maheshwari, cofounder and chief executive of troubled edtech startup Invact Metaversity, has agreed to
leave the company following serious differences with cofounder Tanay Pratap. “I am moving out of Invact to first take a break for a few months and then pursue new opportunities. It is heartbreaking for a founder to leave the startup, like a mother leaving her baby. I am going through the same emotion,” Maheshwari said in a tweet announcing his exit on Friday. Pratap will now take over as the CEO of the startup.
CEO Manish Maheshwari holding company hostage, tweets Invact Metaversity angel investor: Troubled ed-tech firm Invact Metaversity’s early angel investor, Gergely Orosz, publicly criticised the company’s CEO, Manish Maheshwari, days after the latter tweeted about the company’s likelihood of getting shut down.
Invact CEO broke his promise to quit, investor alleges: Earlier, Orosz told investors of the company in an email that its cofounder and CEO Manish Maheshwari went back on a promise to quit the troubled company. He said Maheshwari, the former head of Twitter in India, now wants “more equity than vested.”
Invact Metaversity may wind down ops, cofounder says: Invact Metaversity, the ed-tech startup founded by former Twitter India chief Manish Maheshwari, is likely to wind down within months of starting operations.
Funding winter
Era of being rewarded for hypergrowth at any costs is coming to an end: Sequoia Capital
Sequoia Capital has again issued an advisory on the global downturn, warning the founders of its portfolio companies that they should not expect a quick recovery from the current market conditions. In a 51-page…
Read More: Tech’s biggest losers in 2022