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Facebook stock fell as much as 8% Thursday after it reported fourth-quarter earnings Wednesday evening.

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The drop erased more than $50 billion from the social media giant’s market cap. The shares recovered slightly by midmorning and closed down 6%, the stock’s worst day since June 3, 2019, when it fell 7.51%.

The decline comes after Facebook reported a 51% rise in expenses compared with its total in 2018. The expenses were largely related to the company’s privacy and security improvements. That coincides with a drop in the company’s operating margin, which fell from 45% in 2018 to 34% in 2019.

In addition to the increased expenses, Facebook also warned of advertising headwinds related to privacy and regulatory changes on the horizon, leading to slowing growth in the U.S. Facebook said privacy improvements on Apple’s iPhones and Google’s Android software could hurt its ability to target advertising.

In a note to investors Thursday, Pivotal Research Group reduced its rating from buy to hold on those advertising concerns. Pivotal lowered its price target to $215 from $245.

“The slow down, particularly in the U.S., was far greater than we expected and sounds likely to persist,” Pivotal’s note reads.

Those privacy-related expenses and advertising headwinds are expected to continue throughout 2020. Facebook CEO Mark Zuckerberg said on the company’s earnings call Wednesday that privacy will be a focus for the company this year.

“It’s going to take time, but over the next decade I want us to build a reputation on privacy that’s as strong as our reputation already building good, stable services,” Zuckerberg said.

Facebook? Daniel Acker / Bloomberg

Facebook

Facebook still delivered a beat on the top and bottom lines in its earnings report. Here are the key numbers:

  • Earnings (EPS): $2.56 vs. $2.53 per share forecast by Refinitiv.
  • Revenue: $21.08 billion vs. $20.89 billion forecast by Refinitiv.
  • Daily active users (DAUs): 1.66 billion vs. 1.65 billion forecast by FactSet.
  • Monthly active users (DAUs): 2.5 billion vs. 2.5 billion forecast by FactSet.
  • Average revenue per user (ARPU): $8.52 vs. $8.38 forecast by FactSet.

CNBC’s Salvador Rodriguez contributed to this report.

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