The CEO of Meta Platforms Inc., Mark Zuckerberg said the company will cut more than 11,000 jobs in the first major round of layoffs in the social media giant’s history.
The reductions, equivalent to about 13% of the workforce, was announced Wednesday in a statement. The company will also extend its hiring freeze through the first quarter.
“I want to take responsibility for these decisions and how we got here.Zuckerberg said in the statement. “I know this is difficult for everyone, and I am especially sorry for those affected.”
The company said that while reductions will occur across the business, your recruiting team will be disproportionately affected and your business teams will be “more substantially” restructured. Meta will also scale back its presence in real estate, review its infrastructure spending and transition some employees to hot desking, with more cost-cutting announcements expected in the coming months.
Meta, whose shares have plunged 71% this year, is taking steps to cut costs after several quarters of disappointing earnings and a drop in income. The reduction, the most drastic of the company since the founding of Facebook in 2004it reflects a sharp slowdown in the digital advertising market, an economy teetering on the brink of recession and Zuckerberg’s multi-billion dollar investment in a speculative virtual reality drive called the metaverse.
Zuckerberg said in the statement that he had anticipated the increase in e-commerce and web traffic from the start of the covid-19 lockdowns they will be part of a permanent acceleration. “But the macroeconomic recession, increased competition and loss of advertising signals have caused our revenue to be much lower than expected. I was wrong, ”she assured.
Zuckerberg had announced to employees a September fine that Meta intended to cut spending and restructure teams to adapt to a changing market. The Menlo Park, California-based company, which also owns Instagram and WhatsApp, implemented a hiring freezeand the chief executive said at the time that Meta expected headcount to be smaller in 2023 than this year.
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“Obviously, this is a different mode than what we are used to operating”Zuckerberg said in a question-and-answer session with employees in September, adding: “For the first 18 years of the company, we basically grew rapidly every year, and then more recently, our revenue was flat or slightly down for the first time. So we have to adapt.”
Zuckerberg has been asking investors for patience as he pours billions into his vision for the next great computing platform after mobile phones: the metaverse, a collection of digital worlds accessed through virtual and augmented reality devices. . The effort requires intensive investment in hardware and research that may not pay off many years from now..
Meanwhile, the growth of Facebook’s flagship social network has been stalling. The company is currently working on speeding it up and continuing to add users to the Instagram photo-sharing app.experimenting with a more interest-based algorithm and short videos called Reels.
Meta’s cuts follow cutbacks at many other major technology companies. Corporate software maker Salesforce Inc. said Tuesday that It laid off hundreds of workers from the sales teams., while Apple Inc., Amazon.com Inc., and Alphabet inc. all have slowed or paused hiring.
Snap Inc., parent of rival app Snapchat, is also shrinking, saying in August it would cut 20% of its workforce.
Twitter Inc. last week cut roughly 50% of its workforce after its sale to billionaire Elon Musk. Musk said the layoffs were necessary to curb losses at the social network. He later asked some laid-off workers to come back.
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