Facebook slides after Instagram's cofounders resign
- 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.
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.