MENLO PARK — Facebook app owner Meta Platforms has decided to chop 11,000 jobs, marking a fresh wave of Bay Area tech layoffs and a move that signals “difficult changes” for the stumbling social media behemoth.
The layoffs represent 13% of Facebook’s workforce, Mark Zuckerberg, chief executive officer and co-founder of the tech titan, said in a letter to the company’s employees on Wednesday.
“Today I’m sharing some of the most difficult changes we’ve made in Meta’s history,” Zuckerburg said in the letter. “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 Platforms must become “leaner and more efficient,” Zuckerberg said. The company will chop discretionary spending and extend its hiring freeze through the first quarter of 2023, which equates to the end of March of next year, he said.
“I want to take accountability for these decisions and for how we got here,” Zuckerberg stated. “I know this is tough for everyone, and I’m especially sorry to those impacted.”
Meta Platforms bungled its approach to spending and investments in the wake of the coronavirus outbreak, which unleashed more online spending and e-commerce as people stayed home, an effect that has carried over into the post-pandemic era.
Zuckerberg admitted that Meta miscalculated the intensity of the post-coronavirus demand for technology products and services.
“Many people predicted this would be a permanent acceleration that would continue even after the pandemic ended,” Zuckerberg said. “I did too, so I made the decision to significantly increase our investments. Unfortunately, this did not play out the way I expected.”
The move to e-commerce and digital purchases dwindled after the threat of the coronavirus began to recede. Even worse, the economy has begun to wobble and Meta Platforms and Facebook must combat fierce rivals.
“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,” Zuckerberg said.
Meta Platforms must now embark on a more brutal approach, including layoffs, to cope with the changed realities that confront the company.
“We’ve cut costs across our business, including scaling back budgets, reducing perks, and shrinking our real estate footprint,” Zuckerberg said.
The company’s major job hubs in the Bay Area are at its Menlo Park headquarters, with smaller offices in that city, as well as in Sunnyvale, Fremont and San Francisco.
Zuckerberg conceded that he must bear a huge portion of the blame for Meta’s missteps.
“I got this wrong, and I take responsibility for that,” Zuckerberg stated in the letter.
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