Stock Market Meltdowns Have FAANGs Looking Increasingly Toothless

Nine years ago, Jim Cramer—the gleefully loudmouthed CNBC pundit—introduced the world to what he called the FANG investment strategy. Facebook, Amazon, Netflix, and Google, his reasoning went, were as close to a sure bet as you could get as commerce, community, and content shifted online. A few years later the acronym was plumped up to FAANG with the addition of Apple Inc. Corporate rebrandings at Facebook and Google would end up messing with the spelling, and some insisted Microsoft Corp. should join the party. But the one constant was a sense of infinite optimism about the companies’ ability to dominate their markets and continue growing at a breakneck pace, making huge sums of money for their shareholders.

These days the FAANGs—or whatever you might call them—are looking increasingly toothless. On April 19, Netflix Inc. shocked Wall Street when it announced that for the first time in a decade it had lost customers and predicted that even more would bail in coming months. Its shares fell more than a third that day. That followed Facebook’s February meltdown after it revealed user growth had stalled. The company’s stock suffered the biggest one-day loss in value in U.S. market history.