Meta (Facebook, Instagram) plans to lay off thousands of people starting this week, according to The Wall Street Journal (WSJ), while several tech companies have simply cut some of their workforce in response to the economic crisis. This may be the most basic social program of the sector, according to the American daily, after the epidemic, which greatly contributed to the growth of incomes, but also the staff of these companies. As of September 30, Meta had approximately 87,000 employees worldwide.
In the recent release of disappointing quarterly results, CEO Mark Zuckerberg indicated that the group’s staff should not increase until the end of 2023, or even decrease slightly. According to sources WSJThe social plan is set to be announced on Wednesday, and the first social network giant in its history will affect several thousand employees.
Last Thursday, two Silicon Valley companies, Stripe and Lyft, reported massive layoffs as Amazon froze hiring at its offices. Twitter, recently acquired by Elon Musk, has just laid off about half of its 7,500 employees.
A decline in net profit
Platforms whose economic model is based on advertising are particularly affected by budget cuts and rising interest rates by advertisers fighting inflation. Meta’s net profit in the third quarter reached $4.4 billion (-52% year-over-year).
“We’re dealing with a volatile macroeconomic environment, increased competition, ad targeting issues, and rising costs for our long-term investment, but I have to say that our product seems to be performing better than some of the reviews suggest.“Mark Zuckerberg tried to tone it down at the analyst conference in late October.
But the California group’s stock fell 24.56% on Wall Street the next day. Meta lost nearly $600 billion in market capitalization in one year.
The company has been troubling the markets since the beginning of the year when it first announced that it was losing users to its original social network, Facebook. The costly investment in building the metaverse, touted as the future of the Internet, has not reassured investors who doubt the group’s ability to generate significant revenue from this fledgling parallel universe.
Source: Le Figaro
I am David Wyatt, a professional writer and journalist for Buna Times. I specialize in the world section of news coverage, where I bring to light stories and issues that affect us globally. As a graduate of Journalism, I have always had the passion to spread knowledge through writing.