Facebook stock drops more than 20% after revenue forecast misses
<i>User growth is slowing down to a crawl:</i><p>* There are 4.16 billion Internet users worldwide.[a]<p>* 26.3% of the world&#x27;s population is under 14 years old, close to Facebook&#x27;s minimum age of 13.[b] This means 73.7% of the world&#x27;s population is at least 14 years old.<p>* If we assume the population of Internet users has a similar age distribution as the world&#x27;s population, that means there are around 4.16 * 73.7% = 3.07 billion Internet users who are at least 14 years old.  This is a <i>rough estimate</i> of the maximum possible number of people who can have an account with Facebook today, i.e., the size of the company&#x27;s addressable market (in users, not dollars).<p>* The true size of Facebook&#x27;s addressable market could be higher (for example, if the age distribution of Internet users is different)... but it could also be significantly lower (for example, if a substantial number of Internet users cannot or will not join Facebook due to religious, cultural, or governmental restrictions, or due to the availability of established regional alternatives).<p>* Facebook just reported monthly active users of 2.23 billion, up only 11% from 2.01 billion a year ago.[c]  This isn&#x27;t exactly stellar user growth.  The company now has around 73% penetration of every person in the planet who can join Facebook today.  Again, this is a rough estimate.<p>* The company&#x27;s CFO disclosed in today&#x27;s quarterly earnings call that the company expects a &quot;deceleration&quot; in growth.[d]<p>[a] <a href="https:&#x2F;&#x2F;en.wikipedia.org&#x2F;wiki&#x2F;Global_Internet_usage#Internet_users" rel="nofollow">https:&#x2F;&#x2F;en.wikipedia.org&#x2F;wiki&#x2F;Global_Internet_usage#Internet...</a><p>[b] <a href="https:&#x2F;&#x2F;en.wikipedia.org&#x2F;wiki&#x2F;Demographics_of_the_world#Age_structure" rel="nofollow">https:&#x2F;&#x2F;en.wikipedia.org&#x2F;wiki&#x2F;Demographics_of_the_world#Age_...</a><p>[c] <a href="https:&#x2F;&#x2F;investor.fb.com&#x2F;investor-news&#x2F;press-release-details&#x2F;2018&#x2F;Facebook-Reports-Second-Quarter-2018-Results&#x2F;default.aspx" rel="nofollow">https:&#x2F;&#x2F;investor.fb.com&#x2F;investor-news&#x2F;press-release-details&#x2F;...</a><p>[d] <a href="https:&#x2F;&#x2F;www.cnbc.com&#x2F;2018&#x2F;07&#x2F;25&#x2F;facebook-warns-investors-of-weakening-revenue-in-second-half-of-2018.html" rel="nofollow">https:&#x2F;&#x2F;www.cnbc.com&#x2F;2018&#x2F;07&#x2F;25&#x2F;facebook-warns-investors-of-...</a><p>--<p>EDITS: I updated the global Internet usage figures based on dooglius&#x27;s comment below (the Wikipedia page is outdated). I also expanded significantly on my original post to make my facts and reasoning as clear as possible to others here.