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The Facebook ad boycott is starting to rattle investors

June 29, 2020. Summarized by summa-bot.

Facebook CEO Mark Zuckerberg speaks during the annual F8 summit at the San Jose McEnery Convention Center in San Jose, California on May 1, 2018. (Photo by JOSH EDELSON / AFP) (Photo credit should read JOSH EDELSON/AFP via Getty Images)

After several days of largely shrugging off news about a growing Facebook advertiser boycott, investors now appear to be taking notice.

New York (CNN Business)After several days of largely shrugging off news about a growing Facebook advertiser boycott, investors now appear to be taking notice.

Shares of Facebook (FB) fell nearly 3% in early trading Monday, before rebounding, after big brands such as Starbucks (SBUX), Coca-Cola (CCEP) and Hershey's said they would pause spending on the social media platform over concerns about its handling of misinformation and hate speech.

The dip comes after Facebook's stock ended Friday down 8% on news that Unilever, the massive household goods company, would halt advertising on Facebook and Twitter (TWTR) for the rest of the year.

The stock moves highlight a new uncertainty about just how much the boycott could dent Facebook's ad sales machine.

But some brands like Starbucks do rank high on the list of biggest ad spenders on Facebook, according to estimates by Pathmatics, a market intelligence firm.

A civil rights coalition that includes the Anti-Defamation League (ADL) and the NAACP launched the #StopHateforProfit campaign earlier this month, calling on major corporations to halt advertising on Facebook for the month of July, due to the platform's "repeated failure to meaningfully address the vast proliferation of hate on its platforms. "

Some brands, like Starbucks and Unilever, chose to go beyond the scope of the campaign by rethinking spending across social media platforms, not just Facebook.

On CNN's "Reliable Sources" on Sunday, Facebook's Vice President for Public Affairs, Nick Clegg, pushed back on the premise of the boycott and said the social media giant does not benefit from the proliferation of hate speech on its platform.

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