On Wednesday, Meta said it would lay off 13% of its workforce, or more than 11,000 employees, in one of the biggest tech layoffs this year as Facebook’s parent company faces costs. high growth and weak advertising market. The widespread job cuts, the first in Meta’s 18-year history, led to thousands of layoffs at other major tech companies including Twitter and Elon Musk-owned Microsoft.
The pandemic outbreak has driven tech companies and their valuations to bankruptcy this year in the face of decades-high inflation and rapidly rising interest rates.
“Not only has online commerce gone back to where it used to be, but the downturn in macroeconomics, increased competition, and lost advertising have taken a toll on our revenue,” said CEO Mark Zuckerberg. I’m much shorter than I expected,” CEO Mark Zuckerberg said in a message to employees.
“I got it wrong, and I take responsibility for it.”
Zuckerberg stressed the need to become more capital efficient and said the company would shift resources to “high-priority growth areas” such as AI discovery, advertising and business platforms, as well as my metaverse project.
Meta says it will pay 16 weeks of base pay plus two additional weeks for each year of service as part of a severance package and all remaining paid leave.
Employees will be paid health care costs for six months, and those affected will receive the test slips by November 15, according to the company.
Meta said it also plans to cut discretionary spending and extend the hiring freeze in the first quarter.
The company’s shares, which have lost more than two-thirds of their value, were up about 3% in pre-opening trading.
© Thomson Reuters 2022