Thousands of Meta Group employees, the parent company of Facebook and Instagram, will be laid off starting this week. This move follows similar decisions by other technology companies in response to the current economic market.
87,000 people work for Meta as of September 30th.
At the most recent quarterly results meeting, group president Mark Zuckerberg said that instead of rising by 2023 end-of-year, the company’s number of employees will actually decline slightly.
According to the newspaper’s sources, it is expected that Facebook will announce on Wednesday that thousands of employees will be affected in the first such measure in the history of the social media giant.
On Thursday, two groups in Silicon Valley, Stripe and Lyft announced layoffs while Amazon postponed hiring.
After Tesla CEO Elon Musk and world billionaire acquired the Twitter platform, he immediately laid off approximately half of its 7500 employees.
Global inflation and rising interest rates are causing businesses to cut back on advertisements, and online platforms that rely solely on advertising revenue are struggling as a result.
Despite increasing net sales by 6% year-over-year, Meta Group’s net profit still fell to $4.4 billion in the third quarter.
Zuckerberg cautioned in October that we are presently facing a volatile macro economy, lost advertising, increased competition, and hikes in investments costs. He noted too that based on what he sees “the prospects for our product look better than some comments suggest.”
The group’s shares fell sharply the next day by 24.56% on Wall Street.
The Metaverse is in danger.
The Meta Reality Lab, which is responsible for virtual reality and metaverse development within the company, saw a decrease of 49% in revenue from last year, amounting to $285 million.
During a call with investors, Meta chief financial officer David Weiner explained that the company’s VR headsets had seen declining sales, resulting in an operating loss of $3.7 billion for the unit.
According to The Wall Street Journal, Orizon World’s flagship product, Metaverse has fallen short of the company’s original target of 500,000 users by the end of this year; at present, there are fewer than 200,000 monthly active users.
According to Meta, the average ad priceshowed a decrease of 18% from last year.