Today, Meta’s CEO Mark Zuckerberg announced the company will lay off about 13% of its workforce, more than 11,000 employees, to “become a leaner and more efficient company by cutting discretionary spending and extending hiring freeze through Q1.” This announcement comes amid slow revenue this year due to increased competition and ads signal loss.
In his letter to employees, Zuckerberg talks about the COVID-19 pandemic and how “the world rapidly moved online and the surge of e-commerce led to outsized revenue growth. While Meta’s CEO thought this would become a trend, he now admits that “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.”
With that in mind, Meta’s new plan is to focus resources on “high priority growth areas” such as the AI discovery engine, ads and business platforms, and the metaverse. Mark Zuckerberg says employees will get an email “soon” telling them what this layoff means. In the US, Meta’s CEO promises:
- Severance. We will pay 16 weeks of base pay plus two additional weeks for every year of service, with no cap.
- PTO. We’ll pay for all remaining PTO time.
- RSU vesting. Everyone impacted will receive their November 15, 2022 vesting.
- Health insurance. We’ll cover the cost of healthcare for people and their families for six months.
- Career services. We’ll provide three months of career support with an external vendor, including early access to unpublished job leads.
- Immigration support. I know this is especially difficult if you’re here on a visa. There’s a notice period before termination and some visa grace periods, which means everyone will have time to make plans and work through their immigration status. We have dedicated immigration specialists to help guide you based on what you and your family need.
Outside the US, support will be similar, but separate processes that consider local employment laws, said the CEO.
While we’re making reductions in every organization across both Family of Apps and Reality Labs, some teams will be affected more than others. Recruiting will be disproportionately affected since we’re planning to hire fewer people next year. We’re also restructuring our business teams more substantially. This is not a reflection of the great work these groups have done, but what we need going forward. The leaders of each group will schedule time to discuss what this means for your team over the next couple of days.
With that in mind, Meta will also hire freeze through Q1 “with a small number of exceptions.” As Mark Zuckerberg reviews Facebook’s infrastructure spending, he says he will soon share more about the company’s future.
You can read the full letter here.
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