Meta Chief Executive Officer Mark Zuckerberg said it will fire over 11,000 employees on Wednesday. The layoff will reduce Meta’s staff strength by 13%. The company also extended a freeze on new hiring till the first quarter (January-March) of the next financial year.
“I want to take accountability for these decisions and for how we got here,” Zuckerberg wrote in a message to the staff of the parent company of Facebook and Instagram. “I know this is tough for everyone, and I’m especially sorry to those impacted.”
Zuckerberg said that the layoffs had to be done as investments made by the company towards e-commerce during the coronavirus pandemic did not provide returns in the way that he had expected.
“Not only has online commerce returned to prior trends, but the macroeconomic downturn, increased competition, and ads signal loss have caused our revenue to be much lower than I’d expected,” Zuckerberg wrote. “I got this wrong, and I take responsibility for that.”
The layoffs and the reason cited by the Meta boss are in line with a Wall Street Journal report published on Sunday, which said that thousands of employees of the company would be asked to leave. The report did not mention the exact number of employees who would be sacked, but said that it could be the “largest to date at a major technology corporation in a year”.
The possible layoffs have been triggered due to two major reasons – stagnancy in the growth of Meta’s core social media business, and a lack of returns from its new “metaverse” technology, which focuses on augmented reality, the report said.
As life and livelihood shifted to online platforms during the coronavirus pandemic, Meta hired over 42,000 employees between 2020 to September 2022. These employees account for nearly half of the company’s 87,000 staff strength, as reported in September.
In his note on Wednesday, Zuckerberg also said that the company would look to be “capital efficient” in its investments.
“We’ve shifted more of our resources onto a smaller number of high priority growth areas — like our AI [artificial intelligence] discovery engine, our ads and business platforms, and our long-term vision for the metaverse,” he wrote.
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