Facebook stock price slides after Instagram’s cofounders resign

Instagram CEO Kevin
Systrom
AP Photo/Jeff
Chiu

• Instagram’s two cofounders, Kevin Systrom and Mike
  Krieger, are leaving the company, they said in a statement on
  Monday evening.
• Facebook,
  which owns the Instagram app, saw its stock price slides about
  2% Tuesday following the departures.
• 
  Watch
  Facebook trade in real time here. 
  

Facebook shares
slid more than 2% in early trading Tuesday after
Instagram’s cofounders resigned from the company.

Kevin Systrom, CEO of the Facebook-owned photo-sharing app,
announced that he and fellow cofounder Mike Krieger were
departing the social-media firm. His statement came
after The
New York Times reported the duo had
quit, and
Bloomberg subsequently said that the move came
“after growing tensions with [Facebook’s] Chief Executive Officer
Mark Zuckerberg over the direction of the product.”

Krieger and Systrom together founded Instagram in 2010, and it
was acquired by Facebook for $1 billion in 2012. In recent
months, Facebook has more closely integrated its executive bench
with Instagram, putting a former VP of News Feed as head of
product for Instagram.

The duo’s departure comes after a rough year thus far for
Facebook, which has been plagued with turmoil. While its main
platform has faced backlash and government investigations
surrounding Cambridge Analytica’s misappropriation of tens of
millions of Facebook users’ data to the sustained fallout from
the spread of Russian propaganda during the 2016 election,
Instagram has remained a bright spot in the company’s portfolio.

In a statement, Systrom said he and Krieger were “taking some
time off to explore our curiosity and creativity again,” adding
they “remain excited for the future of Instagram and Facebook in
the coming years as we transition from leaders to two users in a
billion.”

Despite the recent struggles, Wall Street remains bullish on
Facebook, with an average price target of $205 — 24% above
Monday’s closing price. Facebook shares are down 10% this
year. 

Rob Price contributed to this report. 

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