Meta Platforms Inc said on Wednesday it will terminated jobs of 13 percent of its workforce, or more than 11,000 employees, Reuters news report said.
Meta had 87,314 employees as of the end of September.
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“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,” Meta Chief Executive Officer Mark Zuckerberg said in a message to employees.
“I got this wrong, and I take responsibility for that.”
The company also plans to cut discretionary spending and extend its hiring freeze through the first quarter. But it did not disclose the expected cost savings from the moves.
Meta will also slash spending on infrastructure.
Meta will pay 16 weeks of base pay plus two additional weeks for every year of service, as well as all remaining paid time off, as a part of the severance package.
Impacted employees will also receive their shares that were set to vest on Nov. 15 and healthcare coverage for six months.
“While we’re making reductions in every organization across both Family of Apps and Reality Labs, some teams will be affected more than others. Hiring will be disproportionately affected since we’re planning to hire fewer people next year. We’re restructuring our business teams more substantially,” Mark Zuckerberg said.
A bet on metaverse, a shared virtual world, has seen the company forecast as much as $100 billion in expenses for 2023. That has drawn skepticism from investors who are losing patience with investments that Zuckerberg himself expects a decade to bear fruit.
The company is grappling with competition from TikTok and privacy changes from Apple, while being in the crosshairs of regulators around the globe.