In a letter to the workforce, the Facebook founder acknowledges wrong decisions.
(Photo: dpa)
San Francisco, Dusseldorf The Facebook group Meta is laying off more than 11,000 employees in the largest job cuts in its history. That’s about 13 percent of the workforce, said CEO Mark Zuckerberg on Wednesday. Most recently, the group had 87,000 employees. The “Wall Street Journal” had already reported on Monday about upcoming mass layoffs at the Silicon Valley group.
In a letter to the workforce on Wednesday, founder Zuckerberg pointed out that he overestimated the online boom at the beginning of the corona pandemic and therefore increased investments. But now the online business has returned to earlier trends – and the weakening economy and increased competition are also weighing on revenues. He takes responsibility for the decisions and their consequences.
The descent at Meta continued recently. Profits fell by about half in the third quarter to $4.4 billion. That was the worst result since 2019 and the fourth straight decline.
In addition, the online network posted the second drop in sales in a row. Revenues shrank four percent to $27.71 billion in the summer quarter.
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The core business of advertising in online services such as Facebook and Instagram is generating less revenue than before. Because in view of high inflation and concerns about the economy, advertisers are more economical.
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At the same time, the development of virtual worlds promoted by founder and boss Mark Zuckerberg under the keyword Metaverse is eating up more and more money. The stock price has been under pressure for months because investors find the Metaverse investments too high. Zuckerberg had recently announced that the number of employees at Meta could no longer grow for the time being and could also shrink in the coming year because the group would concentrate on fewer areas.
13 percent of the workforce have to go.
(Photo: IMAGO/NurPhoto)
In the last quarter alone, the Reality Labs division, which is working on the Metaverse, posted an operating loss of almost $3.7 billion. Since the beginning of the year, a deficit of 9.4 billion dollars has accumulated – with sales of 1.4 billion dollars in the area. And Zuckerberg announced that Reality Labs’ losses would “grow significantly” in the coming year.
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