Facebook parent Meta Platforms Inc. said on Wednesday it will lay off 13% of its workforce, or more than 11,000 employees, in one of the biggest tech layoffs this year as it grapples with rising costs and a weak advertising market.
The sweeping job cuts, the first in Meta’s 18-year history, follow thousands of layoffs at other major tech companies, including Elon Musk’s Twitter and Microsoft Corp’s MSFT.
The pandemic boom that propelled tech companies and their valuations has turned into a boom this year, in the face of decades-long high inflation and rapidly rising interest rates.
“Not only has online commerce returned to previous trends, but the macroeconomic slowdown, increased competition and the loss of ad signal have caused our revenue to be much lower than I expected,” CEO Mark Zuckerberg said in a message to employees. .
“I got it wrong, and I take responsibility for that.”
Zuckerberg stressed the need to become more capital-efficient and said the company would shift resources to “high-priority growth areas” such as its AI discovery engine, ads and business platforms, as well as its metaverse project.
Meta said it would pay 16 weeks of base salary plus two additional weeks for each year of service as part of the severance package and all remaining time paid.
Employees will receive the cost of health care for six months and those affected will receive their termination on November 15, according to the company.
Meta said it also plans to cut discretionary spending and extend its hiring freeze into the first quarter.
The company’s shares, which have lost more than two-thirds of their value, are up about 3% in premarket trading.
Source: CNN Brasil
Joe Jameson, a technology journalist with over 2 years of experience, writes for top online news websites. Specializing in the field of technology, Joe provides insights into the latest advancements in the industry. Currently, he contributes to covering the world stock market.
