Meta CEO Mark Zuckerberg confirmed to executives that the company would begin laying off employees on Wednesday morning, the Wall Street Journal reported tuesday.
Zuckerberg spoke to hundreds of company executives on Tuesday morning, announcing deep cuts. He mentioned recruiting and sales teams as groups that would see layoffs, according to the WSJ, adding that an internal announcement of the company’s layoff plans is expected around 6 a.m. Eastern Time on Wednesday. .
Zuckerberg said he was responsible for the slowdown in the business, people familiar with the meeting told the newspaper, with over-optimism about growth leading to overstaffing.
Meta human resources manager Lori Goler said employees who lose their jobs will receive at least four months’ salary as severance pay, the WSJ reported, citing people familiar with the matter.
Meta, the parent company of FacebookInstagram and WhatsApp, reported more than 87,000 employees at the end of September.
The tech industry has been suffering from a severe slowdown in recent months, after a spike in success as the world moved indoors during the pandemic. A global economic slowdown, rising interest rates and regulatory battles have caused tech companies such as Alphabet and Amazon to slow or halt hiring. Late August, Snap fired 1,300 employees and reduced investments. Microsoft laid off around 1,000 employees across multiple divisions in October, according to a report by Axios. Last week, Twitter laid off half of its workforce following Elon Musk’s $44 billion takeover of the company.
Meta has seen confusion over the company’s future in recent months as its flagship platform Facebook loses young users and it faces revenue issues due to changes in Apple’s privacy policies. Meanwhile, investors still seem unconvinced by the company’s pivot to the Metaverse.
Last month, investors wiped $80bn (£69bn) on the market value of the company after it announced its profits had halved in the third quarter. It was one of the most dramatic devaluations Wall Street has seen since the start of the year.
Meta’s third-quarter results were the latest in a string of disappointing earnings reports. This lost $230 billion in market value in February in the biggest one-day loss in history for an American company.
Meta had hinted that job cuts were imminent, after first announcing a hiring freeze and potential restructuring in September.