Facebook, Instagram, and WhatsApp’s parent company Meta has confirmed a huge round of layoffs, amounting to 13% of its workforce.
“I want to take accountability for these decisions and for how we got here,” CEO and cofounder Mark Zuckerberg wrote in a statement. “I know this is tough for everyone, and I’m especially sorry to those impacted.”
The news comes as companies across the technological spectrum have announced huge swathes of redundancies in recent weeks, with Twitter laying off some half of its 7,500 workforce in the wake of Elon Musk’s arrival at the helm, while Stripe last week revealed plans to cut its headcount by 14%, or 1,120 employees. And just yesterday, Salesforce confirmed it had laid off “hundreds” of workers.
Meta’s round of layoffs was widely rumored and expected, but we now know the full extent of the company’s plans, and what this will mean for those impacted.
Meta’s headcount equates to around 87,000, meaning that 11,000 people will be leaving Meta globally. According to Zuckerberg, each employee will receive 16 weeks of severance pay, plus two extra weeks for each year of service. So for example, someone who has worked at Meta for four years will effectively get six months pay.
On top of that, workers will also be paid for all remaining unused time off; Meta said it will honor stock-based compensation that was vesting through November 15; and pay health insurance for employees and their families for six months.
Meta’s path to where it finds itself today is a familiar one shared by countless other companies over the past year, though its effects are amplified somewhat by its sheer size. After becoming one of the few companies to hit a trillion-dollar market capitalization — right in the middle of the pandemic — the company sought a new direction in the form of the metaverse, rebranding from Facebook to Meta in the process.
While it would be unfair to apportion blame for Meta’s current predicament entirely to this pivot, the company has been throwing a heck of a lot of money at a project that is nowhere near ready for prime time. The company’s market cap has plummeted to around $250 billion today, a figure the company has not experienced since 2015 when it was on a major ascendency.
The company posted its first every quarterly decline back in June, and later confirmed it was freezing its hiring plans as part of broader cost-cutting measures, with its revenue dip continuing into the following quarter too.
Source: Tech Crunch
