The price of Meta Platforms (NASDAQ:META) — Get Free Story Shares — fell on Tuesday as a result of a Wall Street Journal report implying that European Union officials were planning to tighten up on the social media company’s practice of running targeted ads across its Facebook and Instagram services.
According to a report in The Journal, a panel for the European Data Protection Board, an organization concerned with data privacy and consumer protection, has decided against Meta’s practice of giving users the option to “opt in” to contracts that permit it to create targeted ads based on their online activity.
The panel’s decision will be reflected in any decisions made by the Data Protection Commission of Ireland, which has jurisdiction over Meta’s operations in Europe. The Data Protection Commission of Ireland may then seek fines from Meta or ask that its ad-selling structure be changed, according to the newspaper.
META Stock Outlook
Stocks fall as inflation fears resurface; the JPMorgan CEO predicts a recession. In midday trading on Tuesday, Meta stock was down 6.5%, changing hands for $114.51 per, bringing the stock’s year-to-date fall to over 67%.
The decision to put more money into the expensive project more than made up for the small profits from Meta’s main social media business, which is now estimated to be worth between $30 billion and $34 billion for the next year. This decision will add at least another $4 billion to next year’s capital spending plans.
The App Tracking Transparency (ATT) regulations that Apple put in place last year have made it harder for Facebook to evaluate the success of some ad campaigns, resulting in delayed or limited data, according to CEO Mark Zuckerberg.
In response, the company has had to spend more money and hire more people in AI and machine learning to understand better what users want and make targeted ads more appealing.
Featured Image: Pixabay @ Artapixel