Meta fires over 11,000 employees amidst revenue crisis
By Zion Rufus
In a message to employees today, Facebook founder Mark Zuckerberg has announced plans to reduce the size of company’s team by about 13% and letting go of more than 11,000 of its talented employees.
Zuckerberg said: “We are also taking a number of additional steps to become a leaner and more efficient company by cutting discretionary spending and extending our hiring freeze through Q1. I want to take accountability for these decisions and for how we got here. I know this is tough for everyone, and I’m especially sorry to those impacted.”
In an effort to make Meta more capital efficient, the company will shift more of its resources onto a smaller number of high priority growth areas — including its AI discovery engine, ads and business platforms, and its long-term vision for the metaverse.
Zuckerberg disclosed: “We’ve cut costs across our business, including scaling back budgets, reducing perks, and shrinking our real estate footprint. We’re restructuring teams to increase our efficiency. But these measures alone won’t bring our expenses in line with our revenue growth, so I’ve also made the hard decision to let people go.”
In October, Meta’s market value sank to $268 billion, down from more than $1 trillion in September of 2021. This loss can be credited to the lingering effects of Apple’s 2021 iOS privacy update that made it harder for Meta to target ads to users, competition from players like TikTok, and global economic downturn.
Highlighting some other contributors to Meta’s massive revenue decline, Zuckerberg explained that Meta, like many others, had overestimated earlier marketing predictions.
He pointed: “At the start of Covid, the world rapidly moved online and the surge of e-commerce led to outsized revenue growth. 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. Not only has online commerce returned to prior trends, but the macroeconomic downturn, increased competition, and ads signal loss have caused our revenue to be much lower than I’d expected. I got this wrong, and I take responsibility for that.”
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