Meta Plans to Layoff Thousands Amid Rising Cost and Recent Share Price Collapse: Report
Meta, a social media and technology giant, is reportedly planning to layoff thousands of employees this week due to rising costs and a recent share price collapse.
The Layoffs Could Impact Thousands of Staffs
According to a Wall Street Journal (WSJ) report on Nov. 6, who cited people familiar with the matter that thousands of employees may lose their jobs at Meta’s 87,000-people workforce as a result of the planned layoffs.
There is no indication yet whether the firm’s Reality Labs division, which reported a $3.7 billion loss in the third quarter, will be cut.
Mark Zuckerberg, CEO of Meta, said last week that the company would focus on a few “high-priority growth areas,” including the company’s Artificial Intelligence Discovery Engine, as well as its advertisements and business messaging platforms in Metaverse.
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“So that means some teams will grow meaningfully, but most other teams will stay flat or shrink over the next year […] In aggregate, we expect to end 2023 as either roughly the same size, or even a slightly smaller organization than we are today,” said the CEO.
He also said that metaverse investments will only bear fruit in about a decade’s time and in the mean time Meta has also freeze hiring.
One of the investors in Coinbase, Bobby Goodlatte also tweeted how Meta has around 70,000 employees, which he deemed too much for Meta.
I worked at Facebook when we had 200 employees
I’ve never understood why FB needs 20,000 employees. And less so the 70,000 employees Meta has now@elonmusk’s Twitter layoffs are appropriate
Unfortunate, but appropriate
These businesses just don’t require that many people
— Bobby Goodlatte (@rsg) November 5, 2022
Believing The Investment are Run in The Right Track
During the earnings call, the billionaire entrepreneur reiterated his belief that his firm’s investments in these areas are “on the right track” and urged it to “keep investing heavily.”
The report follows Meta’s third-quarter earnings report, which missed revenue expectations and increased operating costs. According to Yahoo Finance, Meta’s stock is currently priced at $90.79, down 7.56% over the last five days and 73.19% year-over-year.
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In spite of this, it still appears to be actively hiring in its metaverse division, as 38 of its 413 job listings pertain to Augmented Reality and Virtual Reality.
Other than Meta, companies like Stripe, Twitter and Microsoft has also announced job cutting in the near future as the global economy is going through a recession.
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