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Sign in Welcome! Log into your account your username your password Forgot your password? Get help Password recovery Recover your password your email A password will be e-mailed to you. Tech The 6-hour outage — Facebook crashes and so does their stock By Donald Conway 24 mins ago Share Facebook Twitter Pinterest WhatsApp Linkedin ReddIt Email Print Tumblr Telegram
We might not like to admit it, but many of us spend a portion of our day aimlessly scrolling through social media. We use socials as a form of entertainment, to message our friends and keep up to date with the latest news and trends. So, when multiple platforms went down for more than six hours — it didn’t go unnoticed.
This outage was the worst that Facebook have experienced since 2008, with all platforms — Facebook, Messenger, Instagram, WhatsApp and OculusVR — going completely offline on the evening of October 4th.
It might have been a great inconvenience for you, if you rely on these platforms to keep in touch with friends, but it was a far greater nuisance for Facebook. Not only has the tech giant had to deal with frustrated users, Facebook stocks experienced their greatest decline since 2020.
Read on to find out more.
What caused Facebook to crash?
In an official blog post released on the evening of the outage, Facebook admitted that the six-hour crash had been caused by configuration changes that it had made to its routers. What they did not reveal is whether any user data had been leaked during the dark spell.
Despite resolving the problem, some users still reported that they were experiencing problems on the platforms. This included connection issues, feeds failing to load and the message ‘login error code two’ appearing on their screens.
Facebook stocks respond unfavourably
Technology stocks were already experiencing hardships prior to the Facebook outage, caused by rising bond yields. These treasury yields are used to figure out the value of company profits that are predicted to come to fruition in the future.
Facebook experienced its biggest price decline since 9th November 2020, with shares falling by 4.9% on the day of the shutdown. This was largely because of the interview that had taken place on the previous day between CBS and Frances Haugen, a whistle-blower and formerly Facebook’s product manager. Haugen leaked documents that proved that Facebook put their own growth ahead of user safety, causing investors to react negatively.
Of course, the outage was also responsible for the fall in shares prices, with users being completely unable to use any of their services. These catastrophic events took place within 48 hours of each other and it’s predicted that they’ve cost the company an estimated $79 million.
Technology stocks in October 2021
As we previously mentioned, technology stocks have suffered significantly recently amidst rising bond yields:
- Pinterest Inc (PINS) — fell by 5.70%
- Twitter (TWTR — fell by 5.34%
- Snap Inc (SNAP) — fell by 5.34%
- Apple Inc (AAPL) — fell by 2.46%
- Amazon.com Inc (AMZN) — fell by 2.85%
Rising yields have deterred investors from purchasing technology stocks, and indicates that the Treasuries are paying increased interest rates. As a result, tech stocks appear as a riskier investment choice, and has caused many investors to turn to safer US government bonds as a safe haven.
Because of the scale of Facebook and its heavy involvement in our day-to-day lives, it’s no wonder that the company is often caught up in waves of controversy. Stock prices are extremely susceptible to change and are closely affected by external factors, such as news releases. There are plenty of online resources where you can learn how to trade stocks online and its vital that you have a good understanding of the factors that can affect prices before you invest.
Being a market leader, many of the company’s investors hold long-term positions and are largely undeterred by the turbulence that Facebook faces in the short-term, because they know the stock will recover. Facebook is constantly innovating and growing, and we have no doubt that the company will not only recover from the problems that it has faced recently, but will continue to expand going forward.