Here comes the Zuckerpunch: Meta ‘does a Twitter’ and prepares to fire workers TOMORROW by email after stock falls 70%
- Meta will start laying off swathes of employees tomorrow, Mark Zuckerberg said
- He delivered the grim news on a call on Tuesday with hundreds of his executives
- Cuts are likely to amount to thousands of employees and come amid Meta’s tumbling stock prices and billions in losses for its flagship Metaverse project
- Staff are expected to receive news about the layoffs via email at 6 am, with many engineers and Metaverse employees expected to be on the chopping block
Mark Zuckerberg will begin laying off swathes of Meta employees beginning tomorrow, according to reports.
The Facebook founder told executives in a meeting today that broad cuts will be announced, with recruiting and business teams to face losses.
Cuts at the company, which has suffered a huge loss in market value and falling revenues, are likely to amount to thousands of staff.
Employees are expected to be informed about the cuts in a company-wide email to be sent at 6am Eastern time on Wednesday.
Many of the new engineers who were brought on to work the controversial Metaverse over the past two years are expected to be on the chopping block, sources familiar with the matter told Business Insider.
Zuckerberg, 38, was said to have appeared gloomy on the call and also said he was accountable for missteps made by Meta.
He also said the company was overstaffed because he was overly optimistic about the its growth.
Lori Goler, head of human resources at Meta, said employees who are let go will be given at least four months of salary as severance, sources told the Wall Street Journal.
Zuckerberg delivered the grim news about job cuts on a call with hundreds of Meta executives
The Facebook founder was reportedly downcast during the announcement and also accepted responsibility for some of the company’s missteps, saying his optimism led to overstaffing
Meta’s share price has tumbled 71.5 percent since the beginning of the year and the company has also lost billions through its ‘Metaverse’ project, which includes virtual worlds for users
Confirmation of the job losses follows growing speculation that Meta was poised to announce massive cuts to its headcount by up to 10 percent.
Analyst Gene Munster, a managing partner at Loup, which invests in Meta, said the staff cuts would be the largest by any of the big tech companies in 2022.
Details of Meta’s plans come after Twitter’s new chief, Elon Musk, brutally released half of its staff, about 3,750 employees, last week – becoming the latest tech firm to wield the axe.
Meta, which owns Facebook, Instagram and WhatsApp, has around 87,000 employees – so cuts of 10 percent would amount to more than double the headcount lost by Twitter.
According to posts in the Meta employee-only group on Fishbowl, a work-focus media platform, the companies app department is expected to be reorganized.
Meta’s marketing division, partnership department and HR team ‘will be harder hit than others,’ sources knowledgeable about the Fishbowl page told Insider.
Zuckerberg said on the last earnings call in late October: ‘In 2023, we’re going to focus our investments on a small number of high priority growth areas.
‘So that means some teams will grow meaningfully, but most other teams will stay flat or shrink over the next year.’
Zuckerberg will want to avoid the backlash faced by Elon Musk over his brutal Twitter layoffs
About half of Twitter’s employees, roughly 3,750 people, were axed after Elon Musk’s takeover
Zuckerberg said in October that he expected to end 2023 ‘roughly the same size’ signaling that some jobs could be recouped following the layoffs.
It is thought that Meta could launch another hiring drive next year which focuses on its Reality Labs arm, the department which takes the lead on the Metaverse.
Meta recently forecast a weak holiday quarter and significantly more costs next year wiping about $67 billion off Meta’s stock market value, adding to the more than half a trillion dollars in value already lost this year.
The disappointing outlook comes as Meta is contending with slowing global economic growth, competition from TikTok, privacy changes from Apple, concerns about massive spending on the metaverse and the ever-present threat of regulation.
Meta has placed a big bet on its Metaverse being the next big frontier of the technology industry, with CEO Mark Zuckerberg funneling more than $36 billion into the project that many consider – so far at least – to be failing.
The CEO has subsequently seen more than $30 billion of those funds evaporate in a matter of months, while his net worth – which is largely tied up to his company’s valuation – was reported to have lost $88 billion.
According to documents seen by the WSJ, the company planned to hit 500,000 users of its virtual reality platform, Horizon Worlds, by the end of 2022.
The number at the time of writing is less than 200,000, still well below a revised goal of 280,000 by the end of 2022. The documents also revealed that the majority of those 200,000 users, don’t come back after entering the system once with many complaining most of the areas are bereft of other users.
Meanwhile, Meta’s Reality Labs business unit, which oversees its VR and AR activities, has already lost $9.4 billion so far in 2022, according to CNBC.
Those losses, Meta has said, will ‘grow significantly year-over-year’. ‘Beyond 2023, we expect to pace Reality Labs investments such that we can achieve our goal of growing overall company operating income in the long run,’ Meta said last month.
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