Meta will cut 11,000 jobs, or nearly one in seven
(Reuters) – Meta Platforms, the American group that owns Facebook and Instagram, among others, announced on Wednesday its intention to cut its workforce by 13%, the equivalent of cutting more than 11,000 jobs, a large-scale redundancy plan Management’s envisages justified by rising costs and the deterioration of the advertising market.
This redundancy plan, one of the largest launched in the high-tech sector this year, is the first in the history of the company, which Mark Zuckerberg co-founded 18 years ago.
While the pandemic had boosted the activity of “tech” companies and boosted their stock market valuations, the return of inflation and the rise in interest rates this year are causing difficulties that have already caused several other big names such as Tesla or Microsoft cut back on their workforce.
“Not only has e-commerce returned to its previous trends, but the macroeconomic downturn, increasing competition and loss of advertising revenue have resulted in much lower sales than I anticipated,” said Mark Zuckerberg, CEO, in a statement all meta staff .
“I made that mistake and I take responsibility for it.”
He added that the group intends to focus its resources and capital on “high priority growth areas” such as its artificial intelligence engine, its advertising and professional platforms, or its “Metaverse” project.
Meta also plans to reduce its unrestricted spend and extend the hiring freeze through the end of Q1 2023.
Employees whose position is abolished are entitled to a severance payment equal to 16 weeks of base pay plus two weeks per year of service.
Meta shares, which are down 71% year-to-date, gained 3% following the announcement in Wall Street’s pre-opening session.
(Report by Aditya Soni, Nivedita Balu and Eva Mathews in Bangalore, French version by Marc Angrand, edited by Jean-Stéphane Brosse)
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