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November 9, 2022

Facebook Just Fired 11,000 People Using Elon Musk Playbook As Meta Collapses! Why They Deserved It!

TheQuartering [11/9/2022]

According to TheNewYorkTimes:

Since Mark Zuckerberg founded Facebook in 2004, the Silicon Valley company has steadily hired more employees. At the end of September, it had amassed its largest-ever number of workers, totaling 87,314 people.

But on Wednesday, the company — now renamed Meta — began cutting jobs, and deeply.

Meta said it was laying off more than 11,000 people, or about 13 percent of its work force, in what amounted to the company’s most significant job cuts. The layoffs were made across departments and regions, with areas like recruiting and business teams affected more than others. The divisions that were not cut as steeply included engineers working on projects related to the metaverse, the immersive online world that Mr. Zuckerberg has bet big on, two people with knowledge of the matter said.

“I want to take accountability for these decisions and for how we got here,” Mr. Zuckerberg, 38, wrote in a letter to employees. “I know this is tough for everyone, and I’m especially sorry to those impacted.”

The cuts — nearly triple the number that Twitter slashed last week, though not as deep a percentage — represent a stunning reversal of fortune for a once high-flying company whose ambition and room for growth had seemed limitless. Meta spent lavishly over the years, accumulating users, buying companies such as Instagram and WhatsApp, and showering its employees with enviable perks. Not even scrutiny over its data privacy practices and the toxic content on its apps could dent its financial performance, as its stock continued climbing and its revenues soared. At one point last year, Meta was valued at $1 trillion.

But the company has struggled financially this year as it has tried to move into a new business — the immersive world of the so-called metaverse — while grappling with a global economic slowdown and a decline in digital advertising, the main source of its revenue. New competitors like TikTok emerged to capture a younger audience while Meta’s services lost their sheen. Last month, Meta posted a 50 percent slide in quarterly profits and its second straight sales decline, even as its spending soared by 19 percent. Its stock has dropped roughly 70 percent this year.

Mr. Zuckerberg attributed the cuts on Wednesday to growing too quickly during the pandemic, when a surge in online commerce led to a big spike in revenue. He said he had thought the shift would be permanent, leading him to significantly increase spending. Meta’s number of employees at the end of September was 28 percent higher than a year earlier.

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