Major job cuts anticipated at Meta this week

Redundancies follow a dismal Christmas quarter prediction and much higher expenses forecast for next year

After Twitter's massive lay-offs last week, Facebook parent Meta is planning to fire 'thousands' of employees this week.

US media reports at the weekend suggested that the 'large-scale' lay-offs could be announced as early as Wednesday.

Meta 's planned cuts are expected to affect many thousands of its workforce, The Wall Street Journal claimed in a report citing unnamed sources.

'The planned layoffs would be the first broad head-count reductions to occur in the company's 18-year history,' it added.

Meta has around 87,000 employees worldwide working across its different platforms, which include Facebook, Instagram and WhatsApp.

Job cuts have been expected at Meta for some time, following two consecutive financial quarters of falling revenue.

In a recent open letter to CEO Mark Zuckerberg, Meta shareholder Altimeter Capital Management said the firm needed to be streamlined by reducing capital expenditure and cutting jobs. It further said that Meta had lost the trust of investors as it increased spending and its focus on metaverse efforts.

In response to a WSJ question on expected job cuts, a company spokesperson referred to Zuckerberg's statement from last month's earnings call that the business would "focus our investments on a small number of high priority growth areas" next year.

Zuckerberg added on the call: "[T]hat means some teams will grow meaningfully, but most other teams will stay flat or shrink over the next year."

Meta forecast a dismal Christmas quarter and much higher expenses in the next year, wiping nearly $67 billion off stock value.

Zuckerberg estimates that it will take around ten years for the company's metaverse investments to pay off. To save expenses in the meantime, he has had to halt hiring, cancel projects and reorganise teams.

It remains to be seen whether investors have the patience to wait a decade for a return on investment.

In September, the WSJ said Meta could reduce staff to cut costs by at least 10%. Zuckerberg had allegedly told employees the company would cut budget for the majority of teams, and each team would need to resolve how to manage its own headcount changes.

He explained that the freeze was required because the management doesn't want to add individuals to teams where "we don't anticipate to have positions next year."

Chris Cox, chief product officer at Meta, cautioned staff in June of "serious times," stating that workers would have to perform flawlessly in an environment of slower growth.

As global economic growth stalls due to rising interest rates and inflation, and an energy crisis in Europe, many tech businesses - including Microsoft, Twitter and Snap - have reduced employment in recent months.

Platforms that rely on advertising, like Facebook and Google, are feeling the effects of reduced advertising spend.

Last week Silicon Valley firms Lyft and Stripe announced significant redundancies, while Amazon imposed a hiring freeze for its corporate offices.

Elon Musk, the new owner of Twitter, sacked top executives on the first day of the company's acquisition, and fired around 3,500 workers a few days later (although he is now asking some of them to come back, pretty please - Ed.).