Go woke go broke.
Mark Zuckerberg recently announced that Meta will be laying off an additional 10,000 employees and closing out another 5,000 open positions, as part of his “Year of Efficiency” initiative. This decision comes as the company seeks to cut costs amid a slowdown in digital ad sales.
This marks the second round of layoffs for Meta in the last few months, as the company previously cut 11,000 workers in November. With the latest layoffs, Meta has reversed much of the hiring it did throughout 2022 and 2021, bringing staffing levels down to approximately 65,000 workers.
"At this point, I think we should prepare ourselves for the possibility that this new economic reality will continue for many years," Zuckerberg said. "Higher interest rates lead to the economy running leaner, more geopolitical instability leads to more volatility, and increased regulation leads to slower growth and increased costs of innovation. Given this outlook, we'll need to operate more efficiently than our previous headcount reduction to ensure success."
Many analysts believe that these layoffs are necessary for Meta to stay afloat, as the company had grown its headcount by 20% in 2022, leading to a 21% decline in revenue per employee. Jefferies analyst Brent Thill wrote that, “more headcount reductions are needed to offset the last two years of excess hiring.”
These layoffs come at a time when Meta is investing heavily in its metaverse efforts, rolling out new software and hardware to support what Zuckerberg sees as the firm's future. Despite the rising costs, Meta’s Reality Labs segment lost $13.7 billion in 2022, up from the $10.1 billion it lost in 2021.
The woke tech industry founded in Silicon Vally is starting to come back to earth.
After the company bowed to Biden administration censorship during the pandemic Americans and publishers are going elsewhere.
Now the company is taking a beating.
If you are curious what brand slaughter looks like, this is it.