Facebook’s parent company, the recently renamed “Meta”, has been floundering financially for some time, under the weight of increased competition in the social media space and with CEO Mark Zuckerberg having invested a fortune into his already-unpopular-but-barely-functional “Metaverse”.
Now, as Meta’s stock slips ever further into trouble, Zuckerberg is preparing to lay off a rather significant portion of the company’s staff.
Metais laying off 13% of its staff, or more than 11,000 employees, CEO Mark Zuckerberg said in a letter to employees Wednesday.
“Today I’m sharing some of the most difficult changes we’ve made in Meta’s history,” Zuckerberg said in the 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. We are also taking a number of additional steps to become a leaner and more efficient company by cutting discretionary spending and extending our hiring freeze through Q1.”
Shares of Meta were up about 7.7% Wednesday morning.
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The layoffs come amid a tough time for Facebook parent company Meta, which provided lukewarm guidance in late October for its upcoming fourth-quarter earnings that spooked investors and caused its shares to sink nearly 20%.
Investors have been concerned about Meta’s rising costs and expenses, which jumped 19% year over year in the third quarter to $22.1 billion. The company’s overall sales declined 4% to $27.71 billion in the quarter while its operating income dropped 46% from the previous year to $5.66 billion.
As for the blame, Zuckerberg took it squarely onto his shoulders.
“I want to take accountability for these decisions and for how we got here. I know this is tough for everyone, and I’m especially sorry to those impacted.” Zuckerberg said.
The CEO would go on to characterize the seismic loss as “a sad day”, in what could only be described as the understatement of the week.
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