In one of the most significant tech layoffs this year, Meta, the parent company of Facebook, fired 13% of its staff, or more than 11,000 workers.
Facebook’s parent company, Meta, has announced it will lay off 11,000 employees or around 13 percent of the company’s total staff. CEO Mark Zuckerberg announced the news in a blog post, saying he was at fault for being overoptimistic about the company’s future growth based on a pandemic surge.
“At the start of Covid, the world rapidly moved online and the surge of e-commerce led to outsized revenue growth,” said Zuckerberg. “Many people predicted this would be a permanent acceleration that would continue even after the pandemic ended. I did too, so I made the decision to increase our investments significantly. Unfortunately, this did not play out the way I expected.”
The layoffs are the first broad job cuts since Meta’s founding in 2004.
As the bad news has piled up, Meta’s stock has cratered. Its stock price has dropped more than 70 percent this year, and it’s lost $700 billion in market value in recent weeks. However, following Zuckerberg’s announcement of job cuts, the company’s stock price rose more than four percent in pre-market trading.
In the blog post announcing Meta’s cuts, Zuckeberg said laid-off employees in the US would receive 16 weeks of base pay plus two additional weeks for each year of service, health insurance coverage for six months, and support for finding a new career and navigating immigration issues. Zuckerberg said the company would be instituting a hiring freeze through the first quarter of 2023 “with a small number of exceptions.”
The Meta CEO finished his note to employees with a message seemingly aimed at outside observers, including those skeptical of the company’s push into the metaverse.
“I believe we are deeply underestimated as a company today,” wrote Zuckerberg. “Billions of people use our services to connect, and our communities keep growing. Our core business is among the most profitable, with huge potential. And we’re leading in developing the technology to define the future of social connection and the next computing platform. We do historically important work. I’m confident that if we work efficiently, we’ll come out of this downturn stronger and more resilient than ever.”
“We’ll share more on how we’ll operate as a streamlined organization to achieve our priorities in the weeks ahead. For now, I’ll say once more how thankful I am to those of you who are leaving for everything you’ve done to advance our mission.” he added.
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