The social media giant Meta is preparing staff cuts as its grand metaverse ambitions cool off, reported WSJ. The concern resurfaced due to rising discontent among shareholders. Last month, Investment firm Altimeter Capital sent an open letter to Zuckerberg and Meta, recommending them to slash off staff and temper its metaverse plans.
During the epidemic and ensuing lockdowns, social media and technology titans saw unprecedented development. In order to further its metaverse activities, Meta hired roughly 27,000 new workers in 2020 and 2021. Now that life has returned to normal, however, interest in the metaverse is waning, causing Meta to take a second look.
From what we can tell at this point, layoffs on a massive scale at Meta will be announced formally this week. According to the information gathered, Meta employees have already been told to postpone any planned non-essential trips.
As of September, the company allegedly employed around 87,000 people. Zuckerberg said that although certain teams would continue to expand considerably over the next year, some teams will remain stable or decline.
He also said that by the end of 2023, the company anticipates being the same size as it is now, or even smaller. The net income reported fell to $4.4 billion from $9.2 billion the previous year, a decrease of 52%.
The company’s virtual and augmented reality initiatives revealed a $3.7 billion operational loss due to higher spending, particularly for its Metaverse subsidiary and reality laboratories. However, Meta’s Horizon World metaverse had a hard time luring in new members. The number of users continued to fall throughout the year, and now there are less than 200k.
Despite the current market conditions, Zuckerberg is confident that Facebook will become the dominant player in the VR industry in the years to come.
Compiled by Coinbold