Facebook and PayPal shares plunged 25%

Meta shares plunged more than 25% in Thursday trading. This is the largest drop in the company's share price in its entire history.

The biggest blow to Meta's profit, which fell 8% in the fourth quarter and missed analysts' estimates, was the cost of its Reality Labs unit. Meta said it spent $10 billion on virtual reality and metaverse technologies last year.

In addition, Apple's new privacy features have dealt a blow to Meta's advertising business. Advertising revenue is expected to decline by about $10 billion this year due to recent changes that make it harder to track iPhone users' digital habits.

PayPal shares also fell 25% yesterday. Investors were spooked for two important reasons:

1. The company cut its 2022 profit forecast as executives cited a resurgence in in-store shopping, supply chain disruptions and inflation eroding the purchasing power of low-income customers. EBay's efforts to create its own payments division also took a toll.
   
2. Executives also abandoned an ambitious plan to increase user numbers, acknowledging that an expensive marketing campaign had attracted low-spending consumers. The company said it will now focus on getting existing users to spend more.
   

Other payment services have also suffered, with Block shares down 10 percent yesterday.

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