What happened
In what hasn't been a common occurrence lately for Meta Platforms (META 2.11%) investors, their stock's price bounced higher on Tuesday. In contrast to the slumping S&P 500 index, the social media giant's shares gained nearly 4% on the day. That was due to the misfortunes of a big rival across the Pacific Ocean.
So what
Many employees of ByteDance, the Chinese company that operates the mega-popular TikTok short video sharing app, weren't doing the happy dance on Tuesday. According to a report in the South China Morning Post citing "two people familiar with the matter," ByteDance laid off hundreds of its workers as 2022 came to a close. The article did not provide a more precise figure, but it did state that the layoffs were made across numerous business units.
This isn't a blaring alert that the Chinese social media operator is in trouble -- after all, it's a massive beast that employs over 100,000 people across the world. But even if it's tantamount to a slight adjustment in the employee rolls, it's a hint that its business isn't going 100% smoothly.
TikTok and Meta aren't apples-to-apples competitors, really. But as a social media site with a monster following, TikTok does steal eyeballs and attention away from Meta's money asset, Facebook. And that puts pressure on the fundamentals, as Meta is still heavily reliant on ad spending.
NASDAQ: META
Key Data Points
Now what
Meta is one of many beaten-down tech stocks currently cluttering the stock market. Investors are very hungry for good news from the company; in the absence of this they'll take (slightly) bad news from a rival instead. The TikTok layoffs are a relatively minor development, however, so even this little pop in Meta's share price wasn't entirely deserved.
