Mark Zuckerberg cuts 11,000 jobs in Meta

Mark Zuckerberg has laid off more than 11,000 Meta employees, about 13 percent of its global workforce, in what he described as “some of the most difficult changes we’ve made in Meta’s history.”

In a well-informed announcement, the chairman and CEO of Facebook, WhatsApp and Instagram outlined his plans to make the business “more agile and efficient” through spending cuts, a reduction in real estate, a hiring freeze and ” significant culture change. in how we operate.”

“I want to take responsibility for these decisions and how we got here. I know this is difficult for everyone, and I am especially sorry to those affected,” he said.

Shareholders have accused the company of investing too much in its plans for a virtual reality future, known as the Metaverse, to the detriment of its core business.

Like other social media companies, it has suffered from a drop in online advertising since the pandemic. Its most recent financial results showed its profit more than halved in the third quarter, the first time in nearly a decade that it had fallen for four quarters in a row.

In a statement, Zuckerberg said he had misread the impetus the pandemic had given the tech industry, believing it would be “permanent” and had not anticipated the bleak economic outlook.

“Not only has online trading returned to previous trends, but the macroeconomic downturn, increased competition and loss of advertising signs have caused our revenue to be much lower than I expected. I was wrong and I take responsibility,” he said.

Headquartered in Menlo Park, California, Meta was founded by Zuckerberg, 38, in 2004 and now has 87,314 employees. The group changed its name a year ago to reflect its focus on the metaverse, a virtual realm seen by many in Silicon Valley as the next frontier of the Internet.

It owns Facebook, Instagram, and the messaging services WhatsApp and Messenger and has 2.93 billion daily active users on its platforms, who continue to generate almost all of their revenue through advertising sales.

Acknowledging the pain of the firing process, he said all staff would have access to their emails during the day “so everyone can say goodbye.” US employees will be offered 16 weeks of severance pay and an additional two weeks for each year of service and will receive health insurance for six months, while others around the world will receive a similar package.

Ben Barringer, equity research analyst at Quilter Cheviot, said: “It is clearly an unfortunate circumstance for those involved and at risk, however the market will be largely pleased that Mark Zuckerberg is showing signs that he is not adverse to the cost cutting rather than simply spending to fund future projects like the Metaverse.”

The job cuts run counter to Meta’s recent presentation to investors on Oct. 26, which said the workforce at the end of next year would be about the same as it was at the end of the third quarter.

In a parting shot to Metaverse naysayers, Zuckerberg concluded his statement by saying, “I think we are deeply underappreciated today as a company. I am confident that if we work efficiently, we will come out of this recession stronger and more resilient than ever.”

Leave a Comment