Meta Lays Off 11,000 Employees

Meta is firing 13% of its workforce, or 11,000 employees, following its lackluster performance in Q4 that caused its shares to tank by nearly 20%.

“Today I’m sharing some of the most difficult changes we’ve made in Meta’s history,” said CEO Mark Zuckerberg said in a letter.

“I’ve decided to reduce the size of our team by about 13% and let more than 11,000 of our talented employees go.”

Zuckerberg noted that the company is also taking a number of additional steps to curb costs and expenses, which jumped 19% year over year in Q3 to $22.1 billion.

The layoffs are expected to impact employees across the board but will disproportionately impact those in recruiting. That is because Meta plans to continue its hiring freeze through the first quarter with a few exceptions and hire fewer people next year.

“That means some teams will grow meaningfully, but most other teams will stay flat or shrink over the next year,” Zuckerberg said. “In aggregate, we expect to end 2023 as either roughly the same size or even a slightly smaller organization than we are today.”

Zuckerberg noted that affected employees would get 16 weeks of pay and two additional weeks for every year of service. Fired employees will also have access to health insurance for another six months.

The layoffs follow continued criticism of the company’s performance over the past several months and Zuckerberg’s decision to pour billions of dollars into developing the metaverse, which has seemingly failed to take flight. So far this year, the company has invested $9.4 billion in realizing Zuckerberg’s vision of the metaverse with no end to losses in sight.

Meta shareholder Altimeter Capital recently called on Zuckerberg to limit investment in the metaverse to no more than $5 billion annually and asked the company to reduce its headcount by at least 20% and its expenditure by $5 billion.

The company now trades for less than one-third of its five-year average and is worth half as much as Berkshire Hathway. Moreover, this decline has come with a decrease in the company’s market cap, which now lags behind players such as Bank of America, Chevron, UnitedHealth, and Procter & Gamble.

Meta’s stock was reportedly up 7.7% Wednesday morning.

Photo credit: Meta

Originally published at https://retailbum.com on November 9, 2022.