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Facebook weathers an ugly day with stock up 4%

October 26, 2021, 12:42 AM UTC

Even I cannot keep up with the leaks springing out of Facebook.

There are just too many—and that’s after having them all helpfully compiled here. (Thanks for the roundup, David and Anna at Protocol.)

Starting this weekend 17 publications ranging from the New York Times and Wall Street Journal to the Washington Post and Politico started dumping leak-sourced reports, collectively dubbed the Facebook Papers, as a follow-on to the Journal’s recent, explosive Facebook Files. The documents derive from disclosures made by Frances Haugen, an ex-Facebook product manager turned whistleblower, to the Securities and Exchange Commission.

The reports are…exactly what you might expect at this point. They show Facebook executives and employees wrestling mightily to subdue—but always grow, grow, grow!—the media monster they’ve brought into being. Facebook’s problems, in the U.S. and all over the world, are sprawling: content moderation, ideological radicalization, human trafficking, toxic politics and hate speech, and immensely messy decision-making. Plus, it’s losing the teens.

CEO Mark Zuckerberg is feeling unfairly persecuted. “Good faith criticism helps us get better,” he said, before striking a defiant tone on an earnings call on Monday. “But my view is that what we are seeing is a coordinated effort to selectively use leaked documents to paint a false picture of our company. The reality is that we have an open culture, where we encourage discussion and research about our work so we can make progress on many complex issues that are not specific to just us.”

Facebook is among the biggest names in business, so it attracts the most attention. While these complex issues are not unique to the company, the scale of them is. Whatever the company is doing to make progress, clearly it’s not enough—at least that’s the impression the Facebook Papers impart.

How is Facebook faring amid all this? Worried investors sent the company’s stock tumbling more than 6% through the weekend. That big drop came after surprisingly bad earnings out of Snap shocked investors into fearing the worst for other online ad-based businesses, and with the cloud of a Monday anticipated deluge of data leaks hanging over the company. But the stock has bounced back a bit since.

Investors started feeling a bit more optimistic on Monday. They bid Facebook’s shares back up 4% near $333 in after-hours trading, after the company posted better than expected profits ($3.22 per share versus the $3.19 expected) and only a slight revenue miss ($29.01 billion versus $29.67 billion expected). But it’s still down 14% from it’s 52-week high of $384 last month. As CNN Business points out, the company is lagging all of its FAANG peers over a 24-month period.

Recently, Zuckerberg has been talking up his ambition to bring about a so-called metaverse. But before Facebook can tackle that virtual reality, it should fix the one it’s in.

Robert Hackett
@rhhackett
robert.hackett@fortune.com

NEWSWORTHY

$1 trillion. Following news that car-rental company Hertz had ordered 100,000 of its vehicles (and rolled out a new ad campaign featuring Tom Brady to celebrate), Tesla shares surged Monday to put the electric car maker’s market capitalization north of $1 trillion for the first time. The move up puts Tesla in an exclusive club of the world’s largest companies that already includes Apple, Microsoft, Amazon, Alphabet, and Facebook. The news didn’t just line the pockets of Tesla shareholders, either. CEO Elon Musk, already the world’s richest person, saw his personal fortune grow by nearly $29 billion, too, Bloomberg reports. About $8 billion of that came from stock options included in Musk’s 2018 pay package vesting during the third quarter. Said Musk in a tweet: "Wild T$1mes."

Bakkt to the moon. Shares of the newly public cryptocurrency company Bakkt, which was born as an offshoot of New York Stock Exchange parent company Intercontinental Exchange, jumped more than 230% during trading Monday following news that investors quickly gobbled up. First there was the partnership with Mastercard, under which the card company’s network of financial partners and merchants will be integrating crypto services into their products. Then, in the early afternoon, payments giant Fiserv said it too had struck a “strategic relationship” with Bakkt that is also aimed at broadening the “practical uses of crypto and emerging asset classes.”

Amazonians look to unionize, again. With about 2,000 signatures collected, Amazon warehouse workers in Staten Island are inching closer to a union election. Rather than being affiliated with a national union, the effort is being backed by the Amazon Labor Union—a grassroots effort from workers that wants to unionize warehouses across New York. The effort comes in the middle of a massive hiring spree by Amazon worldwide. And earlier this year, another union effort at an Alabama Amazon facility failed, though officials later found it to have been tainted by Amazon’s anti-union campaign.

PayPal takes Pinterest off its board. On Sunday, PayPal put an end to the wave of speculation that it was considering buying DIYer-beloved Pinterest for a whopping $70 a share, marking what would have been the largest social media acquisition ever. And yet, the payments company said Sunday that it is “not pursuing an acquisition of Pinterest at this time.” Following the news, PayPal's shares jumped 6% on Monday. Pinterest shares, meanwhile, fell back to earth after having risen on the rumors—ending down 12.7%.  

FOOD FOR THOUGHT

“Earth’s best employer.” One of the world’s biggest tech companies has a tech problem: Its leave system. For years now, Amazon workers, including those in its warehouses, corporate offices, and elsewhere, have been running into problems with the technology that the ever-growing company has constructed to handle paid and unpaid leave requests. Amazon is working to address the issues, particularly as it hires gobs of new employees. But the fallout has already been catastrophic, with workers falling behind on bills, struggling to pay for medical care, and even losing their jobs. 

From the article: 

In 2017, Leslie Tullis, who managed a subscription product for children, faced a mounting domestic violence crisis and requested an unpaid leave that employers must offer under Washington State law to protect victims. Once approved, Ms. Tullis would be allowed to work intermittently; she could be absent from work as much as necessary, and with little notice; and she would be protected against retaliation.

Amazon granted the leave, but the company didn’t seem to understand what it had said yes to. It had no policy that corresponded to the law of the company’s home state, court documents show. Ms. Tullis said she spent as many as eight hours a week dealing with the company to manage her leave. At one point, she was moving regularly to keep her children safe. Despite the legal protections, her bosses would become visibly frustrated when she was behind on work, “like I was betraying them every day,” she said.

In June 2019, after she took two days of leave to deal with the latest emergency in a continuing family crisis just before a performance plan was due, she was fired for missing the deadline by two days. The Washington State attorney general’s office took up her case, calling Amazon’s leave reporting system “a failure” and arguing that the company retaliated in violation of the state law.

IN CASE YOU MISSED IT

Welcome to the new excruciating world of waiting for everything by Rob Walker

Facebook whistleblower Frances Haugen tells lawmakers the only way to fix the company is to partially destroy its business model by David Meyer

Shiba Inu coin surges on rumors that it would be listed on Robinhood by Grady McGregor

Hyperinflation: Why Jack Dorsey is worried by Chris Morris

Ukraine wants to build a top crypto jurisdiction, not the Wild West by Oleksandr Bornyakov

Chewy CEO Sumit Singh on the pet boom, the pandemic, and moving from puppyhood to profitability by Phil Wahba

Democrats look to Billionaire tax on unrealized capital gains by Lucinda Shen and Jessica Mathews

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BEFORE YOU GO

It’s a bird. It’s a plane. No, it’s a flying car! On Sunday, Chinese EV company Xpeng’s affiliate HT Aero unveiled plans for a flying car that it hopes will hit the road (and the skyway?) in 2024. Backed by the likes of Sequoia China, IDG Capital, and Xpeng, HT Aero is designing its James Bond-esque vehicle to be lightweight, with a foldable rotor and, yes, parachutes included as well. At least the mock-ups look more realistic than the one Bond used in the 1974 film, The Man with the Golden Gun.

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