Facebook parent company Meta is planning to shed a large portion lot of staff beginning this week. It’s the latest tech giant to lay off employees, following Twitter last week.
Social media and tech giants saw rapid growth during the pandemic and subsequent lockdowns. Meta added more than 27,000 employees in 2020 and 2021 combined. Now that some semblance of normality is returning, they’re seeing a contraction.
On Nov. 6, the WSJ cited people familiar with the matter, reporting several thousand employees could be affected. Meta is expected to make an official announcement this week, it added.
The sources said that Meta staff have already been told to cancel non-essential travel. The firm reportedly had over 87,000 workers as of September.
Metaverse Interest Cooling
In the company’s third-quarter earnings call in late October, Mark Zuckerberg said that some teams will still grow. However, he revealed that most of the teams at the company will “stay flat or shrink over the next year.”
“We expect to end 2023 as either roughly the same size, or even a slightly smaller organization than we are today.”
The earnings report came as a sting for Meta. It reported a painful 52% drop in net income, to $4.4 billion from $9.2 billion last year. Expenses soared, especially for its Metaverse division, Reality Labs. The firm’s virtual and augmented reality projects posted a $3.7 billion operating loss for the period.
Investment firm Altimeter Capital sent an open letter to Zuckerberg and Meta. In it, they recommended slashing staff and tempering its Metaverse ambitions, reflecting rising discontent among shareholders. The company’s stock price has tanked 73% since the beginning of the year.
Back in May, BeInCrypto reported that Meta had planned cutbacks to its Metaverse division as its grand ambitions cooled.
There has been a lackluster response to Meta’s virtual world Horizon Worlds. Users have fallen to less than 200,000 over the course of the year, marking a heavy downward trend.
That hasn’t quashed Zuckerberg’s vision, though, as he still sees the firm dominating the virtual reality space over the next decade.
Meta Pushback Mounting
Others are not as convinced. Concerns have been raised about the company’s track record when it comes to data privacy and protection.
Damning internal document leaks and whistleblower revelations have darkened the firm’s reputation even further. It comes as no surprise that the pushback to Meta monopolizing the Metaverse as it does with social media is mounting, just like the company’s bills.
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