Associated Press

Facebook on Friday announced "Messenger Rooms" — a video conferencing platform that allows up to 50 people to join a single room and interact with each other.

The new product offering will be a direct competitor to Zoom Video and Google Hangouts, two products that have seen a surge in demand as more people work from home during the coronavirus pandemic.

News of Rooms prompted a swift 12% decline in shares of Zoom, while Facebook shares were up more than 2% in Friday afternoon trading.

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Facebook on Friday announced "Messenger Rooms" — a new video conferencing platform that allows up to 50 people join a single room and interact with each other.

Rooms will directly compete with Zoom Video, Google Hangouts, and Microsoft Skype, three popular video conferencing platforms that have seen a surge in demand as millions across the globe are under stay-at-home orders.

Prior to today's Facebook announcement, shares of Zoom were trading at all-time highs on news that the company had surpassed 300 million daily users and was going to be included in the Nasdaq 100 Index on April 30. Shares of Zoom traded at $180 this afternoon, but ultimately fell to an intraday low of $158.30 after Facebook made the announcement, representing a decline of more than 12%.

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Facebook investors cheered the news, sending shares to an intraday high of $190, representing a more than 2% increase in afternoon trading. Facebook will report earnings after the market close on March 29.

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