Meta to lay off 10,000 more workers after first cuts in November
Meta will lay off 10,000 more workers and incur restructuring costs ranging from three to five billion dollars, the company announced on Tuesday, with CEO Mark Zuckerberg warning that economic instability could continue for “many years”.
Shares of Meta rose about 5.5%.
“Here’s the timeline you should expect: Over the next two months, organizational leaders will announce restructuring plans focused on flattening our organizations, canceling lower-priority projects, and reducing our rates. hiring,” Zuckerberg said in a message to employees, which was also posted on Meta’s blog.
He added that the company plans to close an additional 5,000 vacancies that it has not yet filled. In a nod to the continued economic uncertainty, Zuckerberg noted that the company should prepare for “the possibility that this new economic reality will continue for many years to come.”
In a filing with the SEC announcing the cuts, the company also said it expects total spending to decline in 2023, ranging from $86 billion to $92 billion.
The new round of layoffs follows a previous round of cuts, announced in November, that affected more than 11,000 workers, equivalent to around 13% of Meta’s total workforce.
Zuckerberg touted 2023 as the company’s “year of efficiency,” in which the company aims to become “a stronger, more agile organization.”
“We’re a technology company, and our end result is what we build for people,” Zuckerberg said. As part of the restructuring, the company will also increase the number of direct reports to each manager.
Zuckerberg told analysts in February that the Meta plans to “cut projects that aren’t working or may no longer be critical” while “simultaneously eliminating layers of middle management to make decisions faster.”
“A leaner organization will execute on its highest priorities faster,” Zuckerberg’s post said.
Yet Meta continues to spend billions of dollars developing the virtual reality and augmented reality technologies needed to build the digital universe known as the Metaverse. The company’s Reality Labs division, responsible for creating the metaverse, lost an estimated $13.7 billion in 2022 on $2.16 billion in revenue.
Amazon announced a new round of layoffs in January, affecting 18,000 employees across multiple divisions.
Twilio, Dell, Zoom, and eBay also recently announced major workforce reductions. In January, Google revealed plans to lay off more than 12,000 workers, Microsoft announced plans to cut 10,000 employees, and Salesforce announced plans to cut 7,000 jobs.
Ashley Capoot, CNBC contributed.