The axe of layoffs falls again on Meta. The company that controls them Facebook, Whatsapp and Instagram have announced the cuts of another ten thousand jobs after having launched the elimination of eleven thousand employees last November.
It is Mark Zuckerberg himself, number one of the holding, who broke the news on social media and prepared the ground for the new round of the plan to reduce costs. The leaders of Meta "in the coming months will announce a restructuring plan, canceling low-priority projects and reducing the rate of hiring - he declared - I have made the difficult decision to further reduce the size of our team that deals with the selection and recruitment of personnel", he explained.
“It’s going to be tough and there’s no way around it. It’s going to mean saying goodbye to talented colleagues who have been part of our success,” Zuckerberg added, noting that Meta will also close another 5.000 open positions for which no hires have yet been made. The new wave of layoffs is helping the stock, which on Wall Street, after the announcement, gained 6,15%.
The market appreciates the improved credit profile thanks to a plan of cuts that allows to reduce the costs of 2023 in a range between 86-92 billion dollars against the 96-101 billion estimated last year.
Meta's crisis fits into that of other Big Tech companies such as Google, Microsoft, Amazon and Twitter which, aided by the post-pandemic backlash, have cut tens of thousands of jobs and are reviewing their investments to reposition themselves on the market. For Meta, the new cut in staffing is linked to the financial targets set for 2023, the year that Zuckerberg has renamed "Year of Efficiency".
A necessary step to face costs that have become excessive between declining sales and a persistent slowdown in advertising revenue, in a business that is also burdened by competition from aggressive companies like Tik Tok.
The strategy aims to eliminate projects that are not performing well or are no longer crucial and, according to rumors, Reality Labs, the division of Meta that deals with the metaverse and which has accumulated losses of over 20 billion, could also end up in the crosshairs.
“We plan to announce restructuring and layoffs in our technology groups in late April, and then in our business groups in late May,” Zuckerberg warned. “In a limited number of cases, this may take until the end of the year,” and “our timelines for international teams will also be different.”
Article published on March 14, 2023 - 20pm
