10,000 extra employees have to be cut during restructuring

Facebook Chairman and CEO Mark Zuckerberg testifies before the House Financial Services Committee on “An Examination of Facebook and Its Impact on the Financial Services and Housing Sectors” at the Rayburn House Office Building in Washington, DC on Oct. 23, 2019.

MANDEL NGAN | AFP | Getty Images

meta will lay off 10,000 additional workers and incur restructuring costs of $3 to $5 billion, the company announced Tuesday, with CEO Mark Zuckerberg warning that economic instability could persist for “many years.”

Shares of Meta rose about 3.5%.

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“Here’s the timeline you should expect: Over the next several months, organizational leaders will announce restructuring plans aimed at flattening our organizations, canceling lower-priority projects and lowering our hiring rates,” Zuckerberg said in a post. to employees, which was also posted on Meta’s blog.

He added that the company plans to close an additional 5,000 positions it has not yet filled. In a nod to the ongoing economic uncertainty, Zuckerberg noted that the company needs to prepare for “the possibility that this new economic reality will continue for many years to come.”

In an SEC filing announcing the cuts, the company also said it expects lower total spending in 2023, ranging from $86 to $92 billion.

The new round of layoffs follows an earlier round of cuts announced in November that affected more than 11,000 employees, representing about 13% of Meta’s total workforce.

Zuckerberg has pitched 2023 as the company’s “year of efficiency,” during which the company aims to become “a stronger and more agile organization.”

“We are a technology company and our ultimate output is what we build for people,” Zuckerberg said. As part of the restructuring, the company will also increase the number of direct reports for each manager.

Zuckerberg told analysts in February that the Meta plans to scrap “projects that are not performing or may no longer be critical” while also “removing layers of middle management to make decisions faster.”

“A leaner organization will execute on its top priorities faster,” Zuckerberg said.

Still, Meta continues to spend billions of dollars developing the virtual reality and augmented reality technologies needed to build the digital universe, the metaverse coined. The company’s Reality Labs division, charged with creating the metaverse, lost about $13.7 billion in 2022 on $2.16 billion in revenue.

This news is evolving. Check back later for updates.

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