Sheryl Sandberg’s Exit From Facebook Parent Meta Isn’t Spooking Wall Street

Wall Street was largely unrattled by her departure. Analysts didn’t view it as an indication of looming challenges for Meta and remain bullish on the company’s prospects. One key reason: Ms. Sandberg’s success in monetizing the tech giant’s platform, helping it to rake in nearly $120 billion in revenue last year.

R.W. Baird analyst

Colin Sebastian

said that Ms. Sandberg’s departure won’t weaken Facebook’s ability to generate revenue and fund founder and Chief Executive

Mark Zuckerberg’s

ambitions to push into areas such as the so-called metaverse, the online virtual realm where proponents expect people to work, shop and interact.

“Her legacy, in our view, is that Meta has one of the strongest business models in the digital economy,” the analyst said in a research note. He added that under Ms. Sandberg’s watch, Meta had “a history of overcoming obstacles to cement a leadership position in social media and online advertising.”

Meta shares, after closing down 2.6% Wednesday following the late afternoon announcement, were ahead 5.4% in recent trading at $198.91. They are down more than 40% so far this year, amid a selloff in tech stocks and challenges in online advertising.

Ms. Sandberg’s departure comes after a stretch of controversy for Meta, from being blamed for Russian interference in the 2016 election to misinformation and harmful posts. Lately,

Apple Inc.’s

new ad-privacy policy, which required apps to ask users whether they want to be track and limited the ability to gather data, is threatening the advertising business of Meta and others.

“While Sheryl is leaving in the midst of perhaps the biggest change and challenge for the digital advertising industry since the introduction of mobile devices, we think that Meta is already on the path towards reviving some of its legacy platform advantages—this could be her final stamp on the business,” Mr. Sebastian said.

Ms. Sandberg has been in her role since 2008, serving as the top lieutenant to Mr. Zuckerberg and becoming one of the most prominent women in business. She was charged with advertising sales and legal and policy issues, freeing Mr. Zuckerberg to focus on engineering challenges.

Andrew Boone

and

Matthew Condon

of JMP Securities, a Citizens Company, said in a research note that Meta is a more mature business now than when Ms. Sandberg arrived. The processes and infrastructure she helped cement, they said, allow Meta “to weather most departures, including Ms. Sandberg’s.”

Ms. Sandberg, who came to the company from a sales and operations role at Google, advanced the company’s digital advertising through several transitions, including mobile, video and, most recently, the “stories” feature of short videos on its platforms.

Now, the company is pivoting toward the metaverse, which will rely less on digital advertising.

That shift will be overseen by Mr. Olivan, whose role will be more internal facing and focused on integrating Meta product and business teams, Mr. Zuckerberg said Wednesday.

Rohit Kulkarni,

managing director at MKM Partners, said in a research note that rather than reflecting business weakness or strategic missteps, Ms. Sandberg’s departure might instead be a sign of pandemic exhaustion on top Silicon Valley executives.

Ms. Sandberg said she plans to spend more time with her family and focus on philanthropy after leaving Meta, though that hasn’t stanched speculation on her next steps, whether in public service or elsewhere in the private sector. “We hope she takes her talents back into tech to create value and facilitating innovation,” Mr. Kulkarni said.

Corrections & Amplifications
Javier Olivan has been named Meta Platforms’ next chief operating officer. An earlier version of this article in one instance misspelled his surname as Olivian. (Corrected on June 2)

Write to Dean Seal at dean.seal@wsj.com