Buzzfeed stock opened at $0.92 per share Wednesday, a 92% decline from it’s opening price of $10.95 in December 2021.
Commentary published by Variety described the plummeting stock value of the media company as an “ominous market warning.” When a stock price drops below $1 for more than 30 consecutive days, the Nasdaq can delist it from the exchange. Such an action would prove “absolutely detrimental” to Buzzfeed and its investors, as well as devaluing the company’s digital media peers, the commentary noted.
The price drop comes just two days after Buzzfeed posted losses of $106,200,000, according to The Hollywood Reporter. The loss was attributed to an overall revenue drop and a non-cash goodwill impairment charge of $102,300,000. Content on the platform accounted for just $54,700,000, a 9% decline year-over-year. Advertising on the site also collapsed by 27% during the last quarter.
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A majority of Buzzfeed’s cash and cash equivalents balance were held by Silicon Valley Bank, which collapsed on March 9, THR continued. A plethora of governmental institutions have reassured all depositors that their assets are fully protected.
Buzzfeed founder and CEO Jonah Peretti stated that the fallout from the collapse disrupted the company initially, but wasn’t expected to have a long-term impact on advertising revenues into the future. “There’s no denying that 2022 was a tough year for digital media. The challenges we faced in Q4 are also impacting us in Q1 2023, and it is clear we have more work to do to realize the full potential of our combined brand portfolio,” Peretti noted in a statement shared by THR. (RELATED: Financial Chief Jeffrey Gundlach Signals US Economy Headed For ‘Imminent Recession’)
The price of Buzzfeed stock rose to $1.09 at the time of writing this article. It’s unclear whether this will hold as other media companies post similar concerns over their valuations, Variety noted.