The layoffs, he said, accounted for 13 percent of the social media giant’s workforce and would affect its metaverse-focused research lab and its apps, including Facebook, Instagram and WhatsApp. The tech industry is in a deep downturn, with several major companies already announcing massive layoffs — Twitter’s new boss, Elon Musk, fired half of his workforce last week.

“I want to take responsibility for these decisions and how we got here,” Zuckerberg said in a note to employees.

“I know it’s been tough for everyone, and I’m especially sorry to those affected,” he added.

Ad-supported platforms like Facebook and Google are suffering as advertisers seek to cut costs as they battle inflation and rising interest rates.

Zuckerberg told employees he had expected e-commerce and online activity to continue to grow during the coronavirus pandemic, but added: “I was wrong and I was responsible for it.”

The downturn has affected companies across the industry, and Apple and Amazon have recently reported disappointing results for investors.

But Meta also faced some unique problems.

Investors have been concerned about Zuckerberg’s decision to spend billions developing Virtual World, an immersive web version accessed through a virtual reality headset.

Zuckerberg renamed the company Meta a year ago to reflect its commitment to the project, but the unit working on Metaverse technology has since lost more than $3.5 billion.

He has signaled several times this year that austerity measures are just around the corner, saying in Wednesday’s letter that layoffs were a “last resort”.

Meta will also continue to freeze hiring next year and envision other spending cuts, he said.

“Fundamentally, we’re making all these changes for two reasons: our revenue outlook is lower than we expected at the beginning of the year, and we want to make sure we’re operating efficiently,” he wrote.

Last month, Meta posted a third-quarter profit of $4.4 billion, down 52% from a year earlier, sending its shares down 25%.

While its platform rules the world in terms of users, profits have slumped — Facebook alone claims about 2 billion people log in every day.

AFP



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