New York November 07, 2022: Meta Platforms Inc. is planning to begin layoffs that will affect thousands of workers from this week, Wall Street Journal reported, citing people with knowledge of the matter.
The job cuts could come as early as Wednesday, the newspaper said. The company has already told employees to cancel non-essential travel from this week, according to the report.
Meta shares rose as much as 3.5% during premarket trading in New York on Monday. The stock has declined about 73% for the year through Friday, when it closed at $90.79 a share.
Chief Executive Officer Mark Zuckerberg in September outlined plans to reorganize teams and reduce headcount for the first time, following a sharp slowdown in growth at the parent of Facebook and Instagram. Zuckerberg said then that Meta will likely be smaller in 2023 than it was this year.
The layoffs come as Meta struggles with growing losses and as it invests heavily in developing its metaverse business.
“Meta may seek at least $3 billion to $4 billion in opex reductions through layoffs and fixed-cost cuts to bring its view closer to the lower end of its expense guidance of $96 billion to $101 billion,” Bloomberg Intelligence Analyst Mandeep Singh wrote in a note on Monday.
The cuts will add to already mounting job losses in Silicon Valley. Twitter Inc. last week slashed nearly 3,700 positions after Elon Musk completed his $44 billion takeover of the social media platform. Other companies that have also reduced their workforce or announced plans to include ridehailing firm Lyft Inc. and hard drive maker Seagate Technology Holdings Plc.