For Facebook, the bill comes due

On Thursday, after months of apologies, scandals, and congressional hearings, Facebook took a market hit, when shares fell 19 percent.

About $119 billion was wiped away, representing the biggest single-day loss in stock market history. “The cost of years of privacy missteps finally caught up with Facebook this week,” Craig Timberg and Elizabeth Dwoskin wrote in The Washington Post. “The steepness of the decline suggests investors are reevaluating the viability of Facebook’s core business—collecting extensive data on users so that they can better target them with advertising—in a world in which public pressure is mounting for stricter privacy protections.”

ICYMI: A California TV station neglected to update an old story on the web. That ended up having big consequences.

Since the 2016 election, Facebook has been compelled to deal with everything from fake news to Russian political ads to the mishandling of user data. In the spring, the Cambridge Analytica scandal brought attention to consumer privacy. In May, the European Union implemented strict privacy laws to take some control back from technology companies. Facebook executives warned that spending on security would cut into profits.

Despite the dramatic stock drop, however, Facebook’s dominance remains unchallenged. While use of its main app has come down slightly in the second quarter of 2018, Facebook’s ownership of Whatsapp and Instagram means the company can claim that, in the month of June, 2.5 billion people used at least one of its apps. During the second quarter of 2018, revenue continued to grow, just more slowly than it has in the past.

For months, Facebook has promised that it would take serious measures to fight its demons. But in report after report, hearing after hearing, the company has provided little assurance that it knows how to address its problems.

ICYMI: Newspaper staffer resigns, says publisher called story “racist against white people”

Below, more on Facebook’s no good, very bad day.

• No longer bulletproof: Sheera Frenkel writes for The New York Times that Facebook’s results “were among the first signs that the issues had pierced the company’s image and would have a lasting effect.”
• Explaining the challenges: Recode’s Kurt Wagner has a helpful look at the problems Facebook is confronting. “Facebook is not invincible,” Wagner writes. “But it’s not as surprising as we think it is, either.”
• Don’t panic: CNN’s Paul R. La Monica says that Facebook is doing exactly what it should in response to the Cambridge Analytica debacle. “Facebook can afford to make moves that will hurt it now because they should pay off down the road,” he writes.
• Coming today: Twitter reports its second-quarter earnings before the bell. In May and June, the company reportedly suspended north of 70 million accounts.

Other notable stories

• CNN’s Jim Sciutto, Carl Bernstein, and Marshall Cohen report that Michael Cohen is willing to tell Special Counsel Robert Mueller that, as a candidate for president, Donald Trump “knew in advance about the June 2016 meeting in Trump Tower in which Russians were expected to offer his campaign dirt on Hillary Clinton.” Chris Cuomo broke the news on his show last night, which made for his second buzzy program of the week. On Tuesday, Cuomo was the first to play Cohen’s recording of a conversation with Trump in which the two discussed payment to suppress a story about one of Trump’s alleged affairs.
• At The Wall Street Journal, Shalini Ramachandran and Benjamin Mullin have a look inside the chaos of Univision’s board room. “Clashing egos and feuds over the company’s future have engulfed the U.S.’s largest Spanish-language broadcasting outlet,” they write. Ramachandran and Mullin describe a scene at a board meeting in December, when Randy Falco, Univision’s chief executive, and Haim Saban, its chairman, screamed at each other. Falco told board members, “I can’t deal with this shit. I quit, I quit!”
• “A small change in President Trump’s travel plans on Thursday morning left some members of the press corps suggesting the White House literally lied about whether the sky was blue to avoid facing questions,” Yahoo News’s Hunter Walker reports. On the nicest day D.C. has had this week, the White House claimed that Trump would drive rather than fly to Andrews Force Base, thereby eliminating the opportunity for reporters to shout questions as he boarded his helicopter.
• Lots of podcasts are following up on Monday’s cuts at the New York Daily News: CNN’s Brian Stelter speaks with three reporters—Chelsia Rose Marcius, Erin Durkin, and Kerry Burke—who were laid off, while The Athletic’s Richard Deitsch interviews Frank Isola, longtime NBA writer, about his 25 years at the paper. Over at CJR, I talk with my colleague Amanda Darrach about a wake for half of the News, and with Kyle Pope, CJR’s editor and publisher, about the gloomy future of local news.
• At The New York Times, Sam Roberts reflects on the way the business has changed during his half century in newsrooms. He includes this tale from early in his career: “I remember telling Jimmy Breslin one morning that I felt queasy and might work from home. ‘I have two words for you,’ he replied. ‘Wally Pipp.’ He reminded me that Pipp was the Yankee first baseman who called in sick with a headache in 1925. Lou Gehrig filled in for him—for the next 2,120 games, until 1939. (I’ve kept Pipp’s photograph on my desk ever since.)”
• The Ringer’s Bryan Curtis profiles Bob Ley, an ESPN anchor and the journalistic soul of the network. “The network’s longest-serving anchor is the perfect figure to interpret the collision of sport and politics,” Curtis writes. “And the Worldwide Leader needs him now more than ever.”

ICYMI: Why the White House banning a CNN reporter actually matters