What are you on about?
The only people that lost money were the ones who had the wrong expectations about the future of the company.
It's the system working as intended.
People who expected the company to do X bid up the price to reflect X being done/true.
People who didn't think/expect that didn't buy it. Or sold it once they realized their expectations were wrong.
Now, a lot of the people who lost money were the ones with the bad expectation
Only people who lost money were the ones with the incorrect expectation. As intended.
but it hurts the company in ways that seem unjust to me
How was the company hurt? They didn't perform to what was expected of them. If they had the price wouldn't have gone down.
Sure people may have had unrealistic expectations of the company. How does that hurt the company though? If the expectations were more realistic the price would never have gone so high in the first place. The result is the same.
(In reality, people in the company would have known the expectations were unrealistic and sold for a profit before it was confirmed to everyone else. That's only a good thing for the people in company) or (the company itself could have raised additional capital at the unrealistic valuations, also good for the company)
That's where the original parent is also misunderstanding. The current price isn't because the company "did good" or "failed". It's only concerned with meeting whatever expectations the investors already had for the future when they bought the shares.
Unrealistic expectations mean an unrealistic price.
The same thing happens the other way. If everyone expected X but they did 2X the price would go up. I'm assuming you'd have no problem with that? So how is it not the same?