Facebook parent Meta is laying off about 13 per cent of its workforce i.e. 11,000 employees after it contends with faltering revenue and broader tech industry woes, CEO Mark Zuckerberg said in a letter to employees on Wednesday.
The move that comes just a week after widespread layoffs at the popular microblogging platform Twitter under its new owner, billionaire Elon Musk.
Meta as well as other social media companies enjoyed a financial boost during the pandemic lockdown era because more people stayed home and scrolled on their phones and computers.
But as the government started revoking lockdowns and people started going outside again and revenue growth began to falter.
An economic slowdown and a grim outlook for online advertising by far Meta’s biggest revenue source have also contributed to Meta’s woes.
In July this year, Meta posted its first-ever quarterly revenue decline that was followed by another, bigger decline.
Last week, microblogging platform Twitter laid off about half of its employees, part of a chaotic overhaul as the new owner, Musk, took the helm.
Musk in a tweet said that there was no choice but to cut the jobs when the company is losing over $4M/day, though he did not provide details about the losses.
Meta has worried its investors by pouring over $10 billion a year into the metaverse as it shifts its focus away from social media.
According to the Meta CEO, “Metaverse is an immersive digital universe that will eventually replace smartphones as the primary way people use technology.”
The social media company and its advertisers are bracing for a potential recession.