Metaplans thousands more cuts after widespread layoffs: Report
- The layoffs could begin this week and affect thousands of employees.
- The cost cuts are in addition to previously announced plans to lay off 13% of Meta’s workforce.
- Meta CEO Mark Zuckerberg is pitching 2023 as the “Year of Efficiency”.
Mark Zuckerberg, CEO of Meta Platforms Inc., left, arrives in federal court in San Jose, California, U.S., Tuesday, Dec. 20, 2022.
David Paul Morris | Bloomberg | Getty Images
Meta is planning another round of layoffs that could affect thousands of workers, according to a Bloomberg News report published Monday night.
The job cuts could start this week and represent an additional round of layoffs, adding to the 13% of Meta workers laid off as part of a sweeping cost-cutting plan announced in November.
A Meta spokesperson declined to comment on the report to CNBC.
Meta CEO Mark Zuckerberg previously indicated that the social networking giant would concentrate this year on efforts aimed at lowering the company’s costs, pitching 2023 as “The Year of Efficiency.” He told analysts in February that Meta is focused on “cutting projects that are not delivering or may no longer be essential” and that it plans to “remove layers of middle managers to make decisions faster.”
The cost-cutting effort comes at a challenging time for the consumer technology company, which said costs and expenses rose 22% year-over-year to $25.8 billion during the fourth quarter, while total sales fell 4% to $32 billion.
Meta’s core online advertising business continues to face obstacles due to factors including a tough digital advertising market, the lingering effects of Apple’s 2021 iOS privacy update and increased competition from ByteDance-owned TikTok.
Meanwhile, the company continues to invest heavily in developing metaverse, which Meta believes could represent the next frontier for mainstream computing. The company’s Reality Labs division, which is tasked with building virtual reality and augmented reality technologies needed for the metaverse, brought in $727 million in revenue during the fourth quarter, but also posted an operating loss of $4.28 billion.
Zuckerberg has said he would “take responsibility” for the company’s previously announced cost-cutting plans, saying he views layoffs “as a last resort.”
“We are restructuring teams to increase our efficiency,” Zuckerberg said last fall when Meta announced layoffs. “But these measures alone will not bring our spending in line with our income growth, so I have also taken the difficult decision to let people go.”
See: Box CEO on earnings, technology spending headwinds, AI opportunities and challenges.
