According to the latest report, Facebook’s parent company Meta announced that in response to soaring costs and a weak advertising market, the company will lay off 13% of its workforce, and more than 11,000 employees will leave as a result.
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It was the first major layoff in Meta’s 18-year history and one of the largest layoffs in the U.S. this year. Other major tech companies, including Microsoft and Elon Musk’s Twitter, have also laid off thousands of jobs.
“Not only has online commerce resumed its previous trend, but the macroeconomic downturn, increased competition, and advertising losses have resulted in our revenue being much lower than expected,” Meta CEO Mark Zuckerberg said in a letter to employees ” I did something wrong and I’m responsible for it,” he said.
Zuckerberg emphasized the need to improve capital efficiency and said the company will shift resources to “high-priority growth areas” such as artificial intelligence engines, advertising, and commerce platforms, and Metaverse projects.
As part of the severance package, Meta said the company will pay 16 weeks of base salary plus an additional two weeks per year, plus any remaining paid vacation time. In addition, employees will receive six months of medical bills, and affected employees will be authorized on November 15.
Meta is also reported to be planning to cut discretionary spending and extend the hiring freeze into the first quarter. Shares in the company were up about 3 percent in premarket trading, but more than two-thirds of its market value has evaporated from its highs.