Meta CEO Mark Zuckerberg has confirmed the social media giant will cut around 11,000 staff after admitting he was wrong to allow the company to rapidly expand during the Covid pandemic.
The cuts mean the Facebook owner will lose 13 percent of its staff.
It will also continue to cut costs and extend its hiring freeze until next year.
In a statement, Zuckerberg said: “Today I’m sharing some of the most difficult changes we’ve made in Meta’s history. I’ve decided to reduce the size of our team by about 13 percent and let more than 11,000 of our talented employees go.
“We are also taking a number of additional steps to become a leaner and more efficient company by cutting discretionary spending and extending our hiring freeze through Q1.
“I want to take accountability for these decisions and for how we got here. I know this is tough for everyone, and I’m especially sorry to those impacted.”
He said at the start of the pandemic, the “world rapidly moved online” which led to “outsized revenue growth.”
This led to “many people” predicting the acceleration would continue after the pandemic ended.
He said: ” I did too, so I made the decision to significantly increase our investments.
“Unfortunately, this did not play out the way I expected.
“Not only has online commerce returned to prior trends, but the macroeconomic downturn, increased competition, and ads signal loss have caused our revenue to be much lower than I’d expected. I got this wrong, and I take responsibility for that.
He added the company needs to become more “capital efficient”, which means moving “resources onto a smaller number of high-priority growth areas — like our AI discovery engine, our ads and business platforms, and our long-term vision for the metaverse.
Cost-cutting includes budgets, reducing staff perks and shrinking the real estate footprint.
He confirmed staff in the US will get:
- 16 weeks of base pay plus two additional weeks for every year of service, with no cap.
- Aall remaining PTO time.
- Everyone impacted will receive their November 15, 2022 vesting.
- Six months of healthcare for staff and their families
- Three months of career support with an external vendor, including early access to unpublished job leads.
- Immigration support for staff on visas.
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No specifics were laid out for staff in other countries, but Zuckerberg said it would be “similar.”
He said: “The teammates who will be leaving us are talented and passionate, and have made an important impact on our company and community.
“Each of you have helped make Meta a success, and I’m grateful for it.
“I’m sure you’ll go on to do great work at other places.”
He went on to say he believes Meta has a big future, despite the cutbacks.
He said: “I believe we are deeply underestimated as a company today.
“Billions of people use our services to connect, and our communities keep growing. Our core business is among the most profitable ever built with huge potential ahead.
“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.”