[Global] Meta announces massive layoffs affecting 11,000 employees

Meta (formerly Facebook) has announced it will lay off around 13 per cent of its total staff; about 11,000 employees, The Verge reports.

CEO Mark Zuckerberg announced the news in a blog post, stating he was at fault for being overoptimistic about the company’s future growth based on a pandemic surge.

“At the start of Covid, the world rapidly moved online and the surge of e-commerce led to outsized revenue growth,” Mr Zuckerberg said. “Many people predicted this would be a permanent acceleration that would continue even after the pandemic ended. I did too, so I made the decision to significantly increase our investments. Unfortunately, this did not play out the way I expected,” he said.

In his announcement, Mr Zuckerberg said the company would now become “leaner and more efficient” by cutting spending and staff and shifting more resources to “a smaller number of high-priority growth areas,” including ads, AI, and the metaverse. Mr Zuckerberg said that the company’s recruiting team would be particularly “disproportionately affected” by the cuts. 

Meta reportedly had around 87,000 employees in September. The November 9  layoffs are the first extensive cuts since the tech company was founded in 2004.

A projected downturn in the US economy has slowed momentum for many tech stocks and this has impacted Meta but the company’s prospects have also reportedly been affected by fierce competition from its rivals and a meandering strategy.

The rise of TikTok and changes to Apple’s privacy policy have squeezed Meta’s formerly lucrative advertising revenues and the company’s investments in the newly developed metaverse appear misguided. Meta has lost $9.4 billion on its metaverse technology in 2022 so far and says it expects to spend even more on the business in the future. 

Meta is not the only tech firm reporting widescale layoffs. Snap said in August it planned to cut 20 per cent of its workforce, Salesforce confirmed that it has laid off hundreds of employees this week, and Twitter has laid off thousands of employees at the behest of new owner Elon Musk.

In the blog post announcing Meta’s cuts, Mr Zuckerberg said laid-off employees in the US would receive 16 weeks of base pay plus two additional weeks for each year of service, health insurance coverage for six months, and support for finding a new career and navigating immigration issues.

Mr Zuckerberg said the company would be instituting a hiring freeze until the first quarter of 2023 “with a small number of exceptions.”

The Meta CEO concluded his note to employees with a message that seemed to be intended for a wider audience.

“I believe we are deeply underestimated as a company today,” Mr Zuckerberg said. “Billions of people use our services to connect, and our communities keep growing. Our core business is among the most profitable ever built with huge potential ahead. And we’re leading in developing the technology to define the future of social connection and the next computing platform.”

Source: The Verge

(Links and quotes via original reporting) 

Meta (formerly Facebook) has announced it will lay off around 13 per cent of its total staff; about 11,000 employees, The Verge reports.

CEO Mark Zuckerberg announced the news in a blog post, stating he was at fault for being overoptimistic about the company’s future growth based on a pandemic surge.

“At the start of Covid, the world rapidly moved online and the surge of e-commerce led to outsized revenue growth,” Mr Zuckerberg said. “Many people predicted this would be a permanent acceleration that would continue even after the pandemic ended. I did too, so I made the decision to significantly increase our investments. Unfortunately, this did not play out the way I expected,” he said.

In his announcement, Mr Zuckerberg said the company would now become “leaner and more efficient” by cutting spending and staff and shifting more resources to “a smaller number of high-priority growth areas,” including ads, AI, and the metaverse. Mr Zuckerberg said that the company’s recruiting team would be particularly “disproportionately affected” by the cuts. 

Meta reportedly had around 87,000 employees in September. The November 9  layoffs are the first extensive cuts since the tech company was founded in 2004.

A projected downturn in the US economy has slowed momentum for many tech stocks and this has impacted Meta but the company’s prospects have also reportedly been affected by fierce competition from its rivals and a meandering strategy.

The rise of TikTok and changes to Apple’s privacy policy have squeezed Meta’s formerly lucrative advertising revenues and the company’s investments in the newly developed metaverse appear misguided. Meta has lost $9.4 billion on its metaverse technology in 2022 so far and says it expects to spend even more on the business in the future. 

Meta is not the only tech firm reporting widescale layoffs. Snap said in August it planned to cut 20 per cent of its workforce, Salesforce confirmed that it has laid off hundreds of employees this week, and Twitter has laid off thousands of employees at the behest of new owner Elon Musk.

In the blog post announcing Meta’s cuts, Mr Zuckerberg said laid-off employees in the US would receive 16 weeks of base pay plus two additional weeks for each year of service, health insurance coverage for six months, and support for finding a new career and navigating immigration issues.

Mr Zuckerberg said the company would be instituting a hiring freeze until the first quarter of 2023 “with a small number of exceptions.”

The Meta CEO concluded his note to employees with a message that seemed to be intended for a wider audience.

“I believe we are deeply underestimated as a company today,” Mr Zuckerberg said. “Billions of people use our services to connect, and our communities keep growing. Our core business is among the most profitable ever built with huge potential ahead. And we’re leading in developing the technology to define the future of social connection and the next computing platform.”

Source: The Verge

(Links and quotes via original reporting)