Facebook hit by $11bn wipeout from its market cap after Instagram founders quit
Shares in Facebook have fallen by more than two per cent as markets opened in the US this afternoon, powered by the sudden exit of the two founders of Instagram.
Facebook's share price fell as much as 3.2 per cent in pre-market trading this morning, before opening 2.4 per cent down to a total market value loss of $11.6bn (£8.8bn).
Six years on from Facebook's $1bn acquisition of the photo-sharing app, Kevin Systrom and Mark Krieger announced in a blog post this morning that they would be moving away from Instagram to "explore our curiosity and creativity again".
Read more: Instagram co-founders quit
The circumstances surrounding Systrom and Krieger's departure remain under scrutiny, as sources told Bloomberg News the two had become agitated with Facebook founder Mark Zuckerberg's increasing involvement in the business.
Revenues at Instagram have been Facebook's fastest-growing source of income in 2018, after Facebook's own user numbers began to stagnate in the wake of the Cambridge Analytica scandal in April.
At its last earnings release in July, Facebook revealed its user numbers had experienced little to no growth in key areas such as North America, prompting its market value to take an overnight $120bn hit and the largest one-day crash in US stock market history.
Read more: Facebook's share price plunges as markets open
The co-founders of messaging service Whatsapp, another of Facebook's popular acquisitions, also left the firm earlier this year.
Zuckerberg said in a statement on Systrom and Krieger's resignation earlier today: "I've learned a lot working with them for the past six years and have really enjoyed it. I'm looking forward to seeing what they build next."