Meta, the parent company of Facebook, Instagram and WhatsApp, has announced it will be cutting a further 10,000 jobs and leaving 5,000 vacant roles unfilled.
The news comes four months after CEO Mark Zuckerberg confirmed that it was preparing to cut 11,000 jobs, impacting 13 per cent of its global workforce.
In a statement posted on his Facebook page and Meta’s new blog, Zuckerberg said that members of the company’s recruitment teams will know by March 15 whether they've been affected, with restructurings and layoffs within Meta’s tech groups expected in April, and then its business groups in late May.
However, he added that in a small number of cases, it may take through to the end of the year to complete these changes, while timelines for international teams will also look different.
Zuckerberg has dubbed these changes Meta’s "Year of Efficiency" and as well as laying off more than 20,000 staff and putting a pause on recruiting, the CEO also said in his note to employees that the company will “make our organisation flatter by removing multiple layers of management.”
Commenting on the current macroeconomic climate, Zuckerberg said the company should prepare itself for the possibility that this new economic reality will continue for many years.
“Higher interest rates lead to the economy running leaner, more geopolitical instability leads to more volatility, and increased regulation leads to slower growth and increased costs of innovation,” he said. “Given this outlook, we’ll need to operate more efficiently than our previous headcount reduction to ensure success.”
Loss-making metaverse remains a priority
The news comes six weeks after Meta posted its fourth quarter 2022 financial results, in which the company’s Reality Labs division reported an operating loss of $13.72 billion for all of 2022. However, despite Zuckerberg today saying that the company would be proactively “cutting projects that aren’t performing or may no longer be as crucial,” the Reality Labs business, which is responsible for the development of the metaverse and hardware products such as Quest headsets and AR glasses, is anticipating an even greater loss in 2023.
“Our single largest investment is in advancing AI and building it into every one of our products,” Zuckerberg said. “We have the infrastructure to do this at unprecedented scale and I think the experiences it enables will be amazing. Our leading work building the metaverse and shaping the next generation of computing platforms also remains central to defining the future of social connection.”
In a filing with the Securities and Exchange Commission (SEC) today, Meta said the anticipated impact of these layoffs and other cost reduction measures, inclusive of restructuring costs, will be approximately $3 billion to $5 billion, relating to facilities consolidation charges, severance and other personnel costs.
After a wave of layoffs in the tech sector in last year, the trend is continuing in 2023, with tech giants including Amazon, Microsoft, Google, IBM, SAP, and Salesforce announcing job cuts. Reasons cited for the job cuts include geopolitical instability, rising interest rates, and the need to cut staff as growth slows in the wake of pandemic-fueled hiring sprees, when demand for cloud and remote-access business services soared.