The parent company of Facebook and Instagram plans a massive layoff plan

Times are tough for employees of tech companies. Meta (Facebook, Instagram) plans to lay off thousands of people starting this week, according to the wall street journal (WSJ), while several technology companies have just laid off part of their workforce in response to the economic crisis.

This could be the most substantial social plan in the sector, according to the American daily, after the pandemic which has largely benefited the growth of revenues, but also of the staff of these companies. Meta had some 87,000 employees worldwide as of September 30.

Disappointing quarterly results

During the recent publication of the latest disappointing quarterly results, boss Mark Zuckerberg mentioned that the group’s staff should not increase by the end of 2023, or even decrease slightly. According to the sources of WSJthe social plan should be announced on Wednesday and several thousand employees will be affected by this first social plan in the history of the social networking giant.

Last Thursday, two Silicon Valley companies, Stripe and Lyft, reported sweeping layoffs as Amazon froze hiring at its offices. Twitter, recently acquired by Elon Musk, has just laid off around half of its 7,500 employees.

Platforms whose economic model is based on advertising are suffering in particular from budget cuts by advertisers struggling with inflation and rising interest rates. Meta thus saw its net profit melt to 4.4 billion dollars in the third quarter (-52% over one year).

“We are dealing with an unstable macroeconomic environment, increased competition, advertising targeting issues and rising costs for our long-term investments, but I have to say that our products seem to be doing better than some reviews. suggest it”, tried to temper Mark Zuckerberg at the end of October, during the conference with analysts. But the title of the Californian group fell 24.56% the next day on Wall Street. In one year, Meta lost nearly $600 billion in market capitalization.

The metaverse does not reassure

The company has been worrying the markets since the start of the year, when it first announced that it had lost users on its original social network, Facebook. The costly investments to build the metaverse, presented as the future of the Internet, do not reassure investors who doubt the group’s ability to derive significant income from this fledgling parallel universe.