Impact of Boycotts

• Since the launch of Stop Hate for Profit campaign, which aims to hit Facebook's annual $70 billion revenue, over 180 companies joined the boycott campaign.
•  Examples of major companies that have joined the boycott campaign include Unilever, Honda, Verizon, Patagonia, Coca-Cola and Starbucks.
• Last week, Facebook stock closed with an 8% drop, with a trading volume of 76 million indicating a significant move in the stock.
• According to an estimation by Bloomberg Intelligence, the boycotts could result in as much as $250 million loss in revenue for Facebook.
• However, some analysts believe that the impact largely depends on how long the boycott goes on. Some put the worst-case scenario as 10-20% multiplied by the duration of the boycott.
• If, for example, the boycotts last for three months, an analyst at Wedbush Securities estimates it to be around 25% of the year (as three months is a quarter of a year) multiplied by 20% of ad revenue. In that case, the math gives an estimation of 5% loss of annual revenue--a worst-case scenario.
• Note that Facebook is projected to grow 10% this year. Thus, a loss of lower than 10% means that the company will still grow at positive rate.

Summary