Facebook Parental Meta Platforms Inc.
plans to announce additional rounds of layoffs in the coming months that would total about the same as last year’s 13% headcount cut, according to people familiar with the matter.
The new cuts, the first wave of which is expected to be announced next week, are likely to hit nontechnical positions especially hard, the people said. The company is also expected to close some projects and teams in connection with these budget cuts.
Meta cut about 11,000 jobs last year, or about 13% of its employees. The cuts this year are expected to reach the same percentage of those that remain, the people said, though the final tally of the cumulative cuts expected in the second quarter is not yet clear.
Among the projects that will be scrapped are some wearable devices that were in the works at Reality Labs, Meta’s hardware and metaverse division, the people said, suggesting they’re withdrawing from efforts to create virtual and augmented reality in the near future. make products popular even as longer-term research efforts continue.
Metastocks rose more than 2% in after-hours trading after The Wall Street Journal reported the planned cuts.
“We continue to look across the business, both Family of Apps and Reality Labs, and really evaluate whether we are focusing our resources on the highest leverage opportunities,” Meta Chief Financial Officer Susan Li said Thursday at the Morgan Stanley 2023 Technology, Media and Telecom Conference. . “This will lead to us having to make some tough decisions to wind down projects in some places, to take resources away from some teams.”
Meta CEO Mark Zuckerberg previously said 2023 would be a “year of efficiency” at Meta and some projects at the company were likely to be halted.
The continued cuts are notable given Mr. Zuckerberg’s prediction in October that the company would end 2023 with about the same number of employees as it did then. The company laid off 13% of its workforce the following month and then tried to encourage further attrition through its performance review process.
Technology companies, including Amazon.com Inc.,
and others have cut thousands of jobs this year and continue as earnings retreat from pandemic-induced highs. According to Layoffs.fyi, a site that tracks job losses in the industry, nearly 300,000 layoffs have occurred since 2022. Overall, information industry employment remained unchanged between July and January, according to federal data. Total employment increased during that time.
Last year’s cuts marked Meta’s first broad restructuring in its history as it faced declining digital ad sales and a declining share price. The layoffs followed a pandemic-era hiring wave that nearly doubled the company’s workforce to more than 87,000 from late 2019 to last September.
The company last month reported improving conditions in its underlying business and said it would buy back another $40 billion in shares to help rejuvenate investor sentiment.
Meta’s stock has rebounded strongly, more than doubling from last year’s November low, though it’s still well below its all-time high of over $384 in September 2021.
On Thursday, the company announced internally that it would close its New Product Experimentation group. That unit was founded in 2019 in an effort to build new consumer-facing apps. In an internal post announcing the decision to discontinue NPE, Meta Chief Product Officer Chris Cox wrote that the company has now “housed NPE-like organizations directly within our product teams.”
The closure was a remarkable turnaround for a once fast-growing team led by Ime Archibong, a highly regarded leader within the company and the top Black product manager. An internal announcement said Mr. Archibong would become lead product for Messenger, the company’s messaging app. What will happen to his staff remains an open question, with Mr. Cox writes that Mr. Archibong and his team would work to integrate staffers “into existing workflows across the company wherever we can.”
In addition to closing projects, the company is also streamlining management layers and bringing together teams focused on the same type of work under one leader. This includes Meta’s marketing and integrity teams, Meta Chief Operating Officer Javier Olivan said at the Morgan Stanley conference.
“Then you can just move resources much faster,” said Mr. Olivan. “It just makes you more efficient.”
Bloomberg News previously reported that Meta was planning another round of layoffs.
Meta will also be moving many of its offices to so-called hot desks in the coming weeks. Hot desks are office setups where employees use shared workstations instead of assigned desks or offices, according to experts.
For employees who are laid off, severance pay is expected to be about the same as for those laid off in November, according to a person familiar with the matter. The package — a minimum of four months’ salary plus additional time on a tenured basis — was one of the most substantial offered during recent tech industry layoffs. Meta has been working for the past few days to set up what is internally referred to as an “alumni portal,” a website intended to streamline questions and paperwork about benefits.
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