Meta’s large-scale layoffs of more than 11,000 people by 13%

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Facebook (Facebook) parent company Meta announced yesterday (9) that it will lay off more than 11,000 employees, equivalent to 13% of the total headcount. Meta chief executive Mark Zuckerberg apologized, acknowledging that he was overly optimistic about the company’s growth. This is the largest layoff since Meta was founded.

 

Zuckerberg apologizes for biggest job cuts in Meta history

“Today, I have decided to reduce the size of our team by 13% and lay off more than 11,000 outstanding employees.” Zuckerberg apologized for this in yesterday’s open letter and emphasized that this layoff is the most difficult decision Meta has ever made one. “I want to take responsibility for these decisions and for getting to where we are, and I know it’s sad for everyone, and I’m especially sorry for those affected.”

Regarding the reasons for the recent decline in Meta’s revenue, Zuckerberg pointed out in the letter that in the early stage of the outbreak of COVID-19 (severe special infectious pneumonia, new coronary pneumonia, Wuhan pneumonia), the surge in e-commerce led to a substantial increase in revenue, which made Many predict that this part of the business will continue to grow even after the pandemic is over. “I did the same, so I decided to significantly increase our investment. Unfortunately, this didn’t work out the way I expected.”

“Not only is the trend of e-commerce returning to its pre-pandemic state, but the overall economic recession, increased competition, and significant losses in advertising have caused the company’s revenue to be far lower than I expected. I was wrong, and I want to do this. Be responsible.” Zuckerberg said that for furloughed employees, Meta will provide 16 weeks of severance pay to the furloughed employees, and pay an additional 2 weeks of salary for each year of seniority, and so on without a cap.

At the same time, the company will also pay for 6 months of medical insurance for employees and their families, and use external service providers to help these people find new jobs. At the same time, Meta has also hired a dedicated team of immigration experts to deal with visa issues for employees, so that resigned employees can obtain corresponding compensation.

“Reuters” reported that as of the end of September, Meta had a total of 87,000 employees, and the layoffs are the first large-scale layoffs since the company was founded in 2004. Currently, Meta has not disclosed the exact cost of layoffs.

 

In the future, capital will focus on high-priority growth areas such as AI and Metaverse

In addition to reducing the size of the workforce, Zuckerberg also said he would rein in other cost sources and reduce discretionary spending. At the same time, Meta will also suspend recruitment before the first season of next year (2023) to make Meta more streamlined and more efficient. In the future, we will look at the company’s business performance and other overall economic factors to decide whether to resume recruitment.

As for the future development of Meta, Zuckerberg emphasized that improving capital efficiency is very important, so in the future the company will transfer resources to “high-tech platforms” including artificial intelligence (AI) search engines, advertising and business platforms, and Meaverse. priority growth areas”.

“I believe we are grossly undervalued as a company today. Billions of people use our services to connect and our community continues to grow,” Zuckerberg said in yesterday’s letter. “I am confident We will come out of this recession stronger than ever.”

 

The outside world still expresses concern about the prospects of the metaverse

At present, it remains to be seen whether the layoffs will reverse Meta’s sluggish revenue. However, experts still expressed concern about the company’s prospects.

“Zuckerberg’s mea culpa statement is unlikely to reassure investors, and instead they may be more disturbed by his admission that he overestimates the company’s prospects,” said Susannah Scott, an analyst at Hargreaves Lansdown. Streeter told The Guardian that with young users dancing to TikTok’s Pied Piper tunes, or creating groups and channels on Discord and Telegram, Meta’s focus will be on following up. recovery, which can be a difficult task. ”

Additionally, Straight is pessimistic about Meta’s investment in the Metaverse, arguing that it’s unclear when this expensive investment will generate revenue. According to Reuters, after the measures to reduce operating costs, Meta will devote more resources to the Reality Labs department responsible for Metaverse investment. However, the company has lost US$9.44 billion (approximately NT$298.3 billion) in business from January to September this year, and the loss is expected to increase significantly in 2023.

 

 

 

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