Meta cuts 11,000 jobs as Zuckerberg says 'sorry'

Meta is the latest big tech firm to announce massive lay offs

(Credit: Drew Angerer via Getty Images)

➡️ The Shortcut Skinny: Meta layoffs

• 😞 Meta will lay off more than 11,000 employees

• 📉 Competition combined with the US economic downturn have hampered the company’s growth

• ✋ CEO Mark Zuckerberg says he takes responsibility

• 🥽 Meta’s still going full steam ahead into the metaverse

Meta, the parent company of Facebook, has announced it will lay off more than 11,000 employees, as CEO Mark Zuckerberg admits his over-optimism in the company’s growth led to overstaffing.

“At the start of Covid, the world rapidly moved online and the surge of e-commerce led to outsized revenue growth,” Zuckerberg said in a blog post. “Many people predicted this would be a permanent acceleration that would continue even after the pandemic ended. I did too, so I made the decision to significantly increase our investments. Unfortunately, this did not play out the way I expected.”

He went on to say the US economic downturn, in combination with increased competition and falling ad revenue, has hampered Meta’s profits. Zuckerberg added that he “got this wrong” and takes “responsibility for that”.

“I want to take accountability for these decisions and for how we got here,” he said. “I know this is tough for everyone, and I’m especially sorry to those impacted.

After the layoffs, which amount to around 13% of the company’s total staff, Meta will shift its resources onto “a smaller number of high-priority growth areas”. They include its “discovery engine” – an AI-assisted system that would better suggest content to Facebook users, a bit like TikTok – adverts, business platforms, and, of course, its “long-term vision for the metaverse”.

Meta’s enthusiastic investment in the metaverse hasn’t paid off. According to CNBC, Reality Labs – the subsidiary of Meta that develops its VR hardware and software – has lost $9.4 billion so far in 2022, and Meta expects it will continue to operate at a loss into 2023. Despite the company’s best efforts, people haven’t started flocking behind its vision of the metaverse. Xbox boss Phil Spencer even described Horizon Worlds, Meta’s virtual reality social platform, as “a poorly built video game”.

The Meta layoffs follow a wave of firings at competitor Twitter. After Elon Musk bought the microblogging platform, he fired nearly half of its staff before asking many to return to build its essential features. Twitter’s layoffs have been messy and prompted a class action lawsuit, but Meta’s will likely go smoother. The company said employees who lose their jobs will be given at least four months' salary as severance.

Despite its poor year, Meta hasn’t been quiet. It launched the Meta Quest Pro last month and looks set to release the Meta Quest 3 next year. Still, if you can’t wait for then, you’re best off preparing for the PSVR 2 pre-order date to roll around so you can get stuck into Sony’s growing list of PSVR 2 games.