As we reported previously, Meta is set to lay off thousands of employees; it was confirmed today by Meta’s CEO Mark Zuckerberg in a press release that the tech giant has laid off 13% of its workforce or 11,000 employees.
I’ve decided to reduce the size of our team by about 13% and let more than 11,000 of our talented employees go.
Meta reportedly had a workforce of 87,000 employees before these layoffs. Further, Mark Zuckerberg explained why they had taken these problematic steps:
At the start of Covid, the world rapidly moved online and the surge of e-commerce led to outsized revenue growth.
Many people predicted this would be a permanent acceleration that would continue even after the pandemic ended.
I did too, so I made the decision to significantly increase our investments. Unfortunately, this did not play out the way I expected.
The hyperinflation that occurred during the pandemic has led to these consequences for most tech giants as the market is in the phase of correcting itself. However, Facebook’s parent company Meta also faced huge losses due to its Metaverse, which crashed its share price this year and cost the company billions of dollars without any profit.
The reasons given by Mark Zuckerberg are similar to why other tech giants are firing thousands of their employees; if we summarize the reason in one word, that would be the ‘Recession‘ as recently, Intel and Snapchat have laid off 20% of their workforce. In contrast, Apple and Amazon have frozen their hiring process.
Similarly, Microsoft has already laid off thousands of employees, affecting the Xbox division. Last week under the supervision of the new Twitter CEO, Elon Musk, the company fired 50% of its employees, affecting over 83% of Indians working in Twitter India offices.
Interestingly Meta’s share price recovered 4% after the announcement of layoffs that was down 70% due to the recession and other losses the company faced. What are your thoughts about this? How long will it take for the world to pass the recession phase? Let us know in the comment section below.
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