Meta, owner of Facebook, Instagram and WhatsApp , has decided to execute a cut of 11,000 employees, representing 13% of its workforce, and freeze hiring until the first quarter, as announced Wednesday the CEO of the company, Mark Zuckerberg, in a statement sent to the staff.
«Today I’m sharing some of the most difficult changes we’ve made in Meta’s history. I’ve decided to reduce the size of our team by approximately 13% and lay off more than 11,000 of our talented employees. We are also taking a number of additional steps to become a leaner and more efficient company by reducing discretionary spending and extending our hiring freeze through the first quarter,» said the company’s chief executive.
Meta, which is undertaking the first massive job cuts in its 18-year history, joins other technology companies such as Twitter that have also announced layoffs recently.
«I want to take responsibility for these decisions and how we got here. I know this is difficult for everyone, and I’m especially sorry for those affected,» said Zuckerberg, who acknowledges his mistakes in the strategy of «significantly» increasing the company’s investments after the pandemic.
«At the beginning of Covid, the rise of e-commerce led to mammoth revenue growth. Many people predicted that 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, it didn’t turn out as I had hoped,» he acknowledged.
«Not only has online trading reverted to previous trends, but the macroeconomic downturn, increased competition and loss of ads have caused our revenues to be much lower than I expected. I was wrong and I take responsibility for that,» he said.
According to the company’s chief executive, in this new environment, the firm must be more capital efficient, so it has shifted more of its resources to a smaller number of high-priority growth areas, including artificial intelligence, advertising and trading platforms, in addition to its long-term vision for the metaverse.
«We have cut costs across our business, including reducing budgets, reducing benefits and reducing real estate. We are restructuring teams to increase our efficiency. But these measures alone will not align our expenses with our revenue growth, which is why I also made the difficult decision to lay people off,» he explained.
«There is no good way to make a layoff, but we hope to provide you with all the relevant information as quickly as possible and then do everything we can to help you through this. Everyone will receive an email soon to let them know,» he said.
Specifically, the company is offering a severance package of 16 weeks’ base salary plus an additional two weeks for each year of service, with no cap, and will cover the cost of medical care for individuals and their families for six months, among other measures.
«Some teams will be affected more than others. Recruiting will be disproportionately affected as we plan to hire fewer people next year,» Zuckerberg has said.
Two weeks ago, Meta published its quarterly accounts, in which it posted a 52.2% drop in net profit to $4.395 billion (similar figure in euros at the current exchange rate). Revenues, meanwhile, fell by 4.5% to 27,714 million.
