After Twitter, Facebook’s Meta prepares for a mass layoff
- Meta reported more than 87,000 employees at the end of September. The mass Meta layoff would be the first broad head-count reductions to occur in the company’s 18-year history.
In the recent quarterly earnings call of Meta, CEO Mark Zuckerberg hinted at the possibility of layoffs in 2023, stating that it “is a period that demands more intensity” and that he expects the company “to get more done with fewer resources.” Not too long after that, there were reports surfacing that the company formerly known as Facebook, is preparing its first mass Meta layoff as early as this week.
The planned layoffs, should they materialize, would be the first broad head-count reductions in the company’s 18-year history. Zuckerberg, when explaining to investors on the company’s third-quarter earnings call, said the approach Meta was taking towards setting its 2023 budget was to make significant changes across the board to “operate more efficiently.”
“We are holding some teams flat in terms of headcount, shrinking others and investing headcount growth only in our highest priorities. As a result, we expect headcount at the end of 2023 will be approximately in-line with third quarter 2022 levels, either roughly the same size, or even a slightly smaller organization than we are today,” he said.
The Wall Street Journal reported in September that Meta was planning to cut expenses by at least 10% in the coming months, in part through staff reductions. The cuts expected to be announced this week follow several months of more targeted staffing reductions in which employees were managed out or saw their roles eliminated. “Realistically, there are probably a bunch of people at the company who shouldn’t be here,” Zuckerberg told employees at a companywide meeting at the end of June, according to the Journal, flagging up initial concern of a mass Meta layoff.
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Meta, like other tech giants, went on a hiring spree during the pandemic. It added more than 27,000 employees in 2020 and 2021 combined, and added a further 15,344 in the first nine months of this year—about a quarter of that during the most recent quarter. Its headcount reached 83,553 as of September this year.
It is commonly known that much of the ballooning costs in Meta stem from Zuckerberg’s commitment to Reality Labs, a division of the company responsible for virtual- and augmented-reality headsets as well as the creation of the metaverse. Even during the company’s quarterly earnings call, Zuckerberg did not shy away from admitting that he is committed to spending more (in billions) to develop the metaverse further.
Perhaps that is why Meta, in a statement, said that it does “anticipate that Reality Labs operating losses in 2023 will grow significantly year-over-year.” Yet Zuckerberg assured investors that the loss-heavy division could eventually be worth trillions. To put things into context, Meta just revealed that its Reality Labs metaverse division recorded a loss of over US$3.6 billion in the third quarter of this year, compared to US$2.63 billion at the same time last year.
On the other hand, Twitter cut close to 3,700 people last week via email as a way to trim costs following Elon Musk’s acquisition, which closed in late October. “Many employees learned they lost their job after their access to company-wide systems, like email and Slack, were suddenly suspended,” a report by Bloomberg stated.
20 February 2024
20 February 2024
19 February 2024