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Meta (Facebook) is also affected by massive layoffs

Meta reduced its profits by 52% during the third quarter of 2022; the second largest drop in its history. It currently has 87 thousand employees, how many will be fired and from which departments?

According to sources quoted this Sunday by The Wall Street Journal, Meta Platforms, Inc, Facebook’s parent company, will announce a massive layoff plan this week. The measure would be confirmed as of Wednesday, affecting thousands of employees; without being certain of the amount and the departments with the most cuts.

This will come days after the biggest cut in human talent that has hit Twitter, with some 3,700 workers laid off, or half of its total workforce; after the acquisition of Elon Musk.

Meta’s cost-cutting strategy could outperform Twitter’s in number of layoffs; the first major downsizing by CEO Mark Zuckerberg in the 18 years since Meta, formerly Facebook, was created.

Word of Meta’s problems relating to its finances first surfaced in October. As the company contracted 52% in the third quarter of 2022, reaching 4.3 billion dollars; the second quarterly drop in revenue in its history.

While earnings did rise but they were less than expected, so much so that its stock crashed with a loss of a quarter of its value on the Stock Market, falling by 24.56% and losing more than 89 thousand in a single day. Millions of dollars.

The cases of Meta and Twitter are different, but in the long run they are symptoms of the crisis in the technology sector and the deterioration of the world economy. The traditional earnings of Meta, which operates Facebook, Instagram and WhatsApp, among other applications; have stagnated. Added to this is the strong competition from other social networks that are on the rise like TikTok and the blocking of advertising tracking by Apple.

At the end of September of this year, Meta had 87,314 employees, 28% more than in 2021. The Wall Street Journal does not indicate the percentage of employees to be laid off, but it does speak of ‘thousands of layoffs.‘ The teams or product areas most affected by the decision are also not known.

Mark Zuckerberg, founder of Facebook, had already asked investors for patience, arguing that Meta’s efforts and its development of the metaverse would take about a decade to fully take off.

“We are going to focus our investments on a small number of high-priority growth areas. That means some work teams will grow significantly, but most will remain flat or shrink over the next year. Collectively, we expect to end 2023 with the same size, or even a slightly smaller organization than today,” he explained.

According to Zuckerberg, his company faces short-term challenges and the foundations are in place to return to higher revenue growth. His focus for 2023 is prioritization and efficiency to navigate the current environment and emerge as an ‘even stronger’ company.

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