Shares of Facebook (META 6.30%) were down modestly today after the social media giant was slapped with a $267 million fine by an Irish regulatory agency. Additionally, Instagram was experiencing an outage this morning, though the fine seems to be the main reason for the dip.
As of 2:49 p.m. EDT, the stock was down 1.8%, wiping nearly $20 billion off of its market cap.
The Data Protection Commission, Ireland's privacy regulator, fined Facebook-owned messaging service WhatsApp $267 million for violating European Union privacy rules about sharing user data with other Facebook-owned properties. The fine concludes an investigation that began in December 2018 after the EU's General Data Protection Regulation went into effect. Facebook said it would appeal the decision, saying the penalty was disproportionate to the infraction.
While $267 million is a modest fine for Facebook, equivalent to about three days' worth of net income, the news is a reminder that privacy issues and regulatory fines are still going to be a thorn in its side. In 2019, the company was fined $5 billion by the Federal Trade Commission for violating consumer privacy rules, and such penalties also weigh on the company's reputation, which was badly damaged in the wake of the 2016 presidential election and the Cambridge Analytica scandal.
Separately, Facebook also finds itself at the center of another controversy as a Congressional committee is demanding records from Facebook and other social media platforms on communications that took place on Jan. 6 and ahead of the attack on the Capitol building. While Facebook has sought to stay out of politics as much as possible, the nature of its business makes it something it can't avoid. The Jan. 6 investigation is unlikely to have direct business repercussions for Facebook, but the company's response to the inquiry will be closely watched, especially amid threats from Republican leaders to Facebook and its peers if they comply with the requests.