It’s the biggest job cut in Meta’s history – the Facebook group has announced it plans to lay off 11,000 employees. This corresponds to 13 percent of the entire workforce.
Facebook group Meta is firing over 11,000 employees in the biggest job cut in its history. That’s about 13 percent of the workforce, CEO Mark Zuckerberg said. He pointed out that he overestimated the online boom at the start of the corona pandemic and therefore increased investment. But now the online business has returned to previous trends and the weakening of the economy and increased competition are also having a negative impact on revenues. He takes responsibility for decisions and their consequences.
Meta has the problem that its core business with advertising in online services like Facebook and Instagram generates less revenue than before. At the same time, the development of virtual worlds promoted by founder and boss Mark Zuckerberg with the keyword Metaverse is consuming more and more money. Zuckerberg had recently announced that the number of Meta employees could no longer grow for the moment and could even decrease in the next year as the group would focus on fewer areas.
In the last quarter alone, the Reality Labs division, which is working on the Metaverse, reported an operating loss of nearly $ 3.7 billion (currently 3.67 billion euros). A $ 9.4 billion deficit has accumulated since the beginning of the year, with revenues of $ 1.4 billion in the area. And Zuckerberg announced that Reality Labs’ losses would “grow significantly” over the next year.
The decline in sales has accelerated. Meta suffers from the frugality of advertisers, who spend less money on online ads in the face of high inflation and economic worries. Meta revenue fell 4% year-over-year to $ 27.7 billion. The bottom line is that profits fell 52% to about $ 4.4 billion. The share price has been under pressure for months as investors find the Metaverse’s investments too high.
