Acxiom Corporation (NASDAQ: ACXM) announced on Wednesday that it was informed by Facebook Inc. (NASDAQ: FB) that their partnership will be terminated due to the recent privacy scandal matter. Acxiom shares plummeted by 32 percent on Thursday.
Facebook announced its plans on Wednesday to shut down its Facebook Partner Categories. The division provides audience targeting options by leveraging third-party data providers, such as Acxiom’s Audience Solutions division.
Facebook’s new move to shut down the division is in the midst of its data leak scandal which exposed more than 50 million Facebook profiles that were gathered by an app for data which passed information to Cambridge Analytica, a political firm that was hired during President Trump’s presidential campaign.
"While this is common industry practice, we believe this step, winding down over the next six months, will help improve people's privacy on Facebook," the social media giant said in a statement Wednesday.
Acxiom said in its statement that the company does not expect the changes to affect it fiscal 2018 guidance, but forewarns that its fiscal 2019 revenue could be impacted by as much as $25 million. However, Acxiom expects its LiveRamp segment to grow by 30 percent year over year.
“Today, more than ever, it is important for businesses to be able to rely upon companies that understand the critical importance of ethically sourced data and strong data governance. These are among Acxiom’s core strengths,” said Acxiom CEO Scott Howe. “It will always be true that the ethical use of data creates tremendous value for both businesses and consumers.”