The current economic crisis is hitting companies with full force, notably due to the still on-going consequences of Covid-19, inflation, and also the potential upcoming recession. Companies hence resort to extreme measures so as to make savings, and decide to proceed with important headcounts. Worldwide renowned companies such as Netflix, Shopify, Snap or recently Twitter consequently reduced their staffing numbers. And it is now Meta’s turn.
“Our plan is to steadily reduce headcount growth over the next year”, Mark Zuckerberg stated last May. He has also personally asked his management team to identify weak performers. As a reminder, Meta – which encompasses Facebook, Instagram, WhatsApp and other smaller teams – currently counts 87,000 employees, which means that even a small percentage of layoff would be substantial. This means that the company is to back-pedal, after an optimistic hiring campaign during the Covid-19 pandemic.
This proves that Meta is clearly under pressure. The company’s valuation reached the trillion dollar mark back in 2021, and has now fallen to $250 billion. Beside, a recent publication on Meta’s Q3 report unveils a real gap between profit and expenses. While profit saw a 4%-decrease, expenses rose up to 19% last quarter.
“We’re approaching 2023 with a focus on prioritization and efficiency that will help us navigate the current environment and emerge an even stronger company,” Zuckerberg commented. This focus on “prioritization and efficiency” appears to imply and even support this money saving strategy, notably in terms of headcounts. This is to “achieve [Meta’s] goal overall company operating income in the long run”. Zuckerberg is still determined to make the Metaverse work and operational, at the expense of other side-Meta’s on-going projects and thousands of employees.
There are no further details as of yet regarding the downsizing plan, as an announcement is expected tomorrow.