Meta has BILLION$ of reasons not to leave the EU

Europeans were either excited or shocked as Meta threatened to pull out of the region over upcoming data laws.

For the uninitiated, lawmakers are considering a new rule that requires tech companies to keep the data of European users within the boundaries of the continent.

At the time, the tech giant said that if this law is passed, it “will likely be unable to offer a number of [its] most significant products and services, including Facebook and Instagram, in Europe.”

Last night, Meta flipped. It clarified it’s “absolutely not threatening to pull out of Europe.” The title of the blog post is akin to Trump yelling “FAKE NEWS” on Twitter in those horrible days gone by.

However, the content is more sensible than the title, and the company points out that, just like other firms, it has concerns that preventing transatlantic data transfers would hamper their businesses.

What’s more, for a company that’s losing its stock value rapidly, it doesn’t make sense to pull out of a region that creates significant revenue. Here are some numbers from last quarter’s (Q4 2021) results to prove it:

• Facebook has more than 309 million daily active users in Europe. While there’s hardly any growth in the last five quarters, it represents almost 16% of its global user base.

• The monthly active user number for this region is 427 million — 14.6% of its total user base.
• The company’s total revenue for the region is $8.3 billion — 24% of its global total ($33.67 billion) last quarter.
• Facebook’s average revenue per user (ARPU) is $19.68. The highest ever for the region.

This shows one thing clearly: Europe is incredibly important for the company. And there’s no political sense to pull out from there, as many of its data centers and technology offices are based within its borders.

Staying in everyone’s good books is in the best interest of the company, as countries like Germany and France have already indicated they can do without Facebook.

The same is not true in the opposite direction.

When Meta’s daily active user base dipped for the first time in history, its stock crashed and burned. And what did user numbers fall by? A paltry million. Yet, the company lost more than $200 billion from its market cap, leaving its total value under $600 billion.

The only advantage for Meta pulling out of Europe is that it’d be unlikely to face the same antitrust lawsuits as it does there in the US — but the monetary cost of such a decision would be astronomical. And that’s not the sort of thing Zuck wants to pay.