Meta, Facebook’s parent company, is laying off more than 11,000 employees or 13% of its total workforce, according to CNET reports. The notice came in an e-mail sent by CEO Mark Zuckerberg on Wednesday, November 9.
The social networking giant currently employs about 87,000 people, and Wednesday’s layoffs represent the first large-scale workforce reduction in the company’s 18-year history. Social media rival Twitter was hit with layoffs last week under new owner Elon Musk, with around half of its 7,500 workers losing their jobs.
In a letter to employees, Zuckerberg also said the company is reducing its budget, cutting back on real estate and extending its hiring freeze until March.
He blamed the cuts on the company’s rapid growth during the pandemic, when increased online commerce resulted in revenue growth. He had believed this would continue and increased the company’s spending.
“Unfortunately, this did not play out the way I expected,” he wrote. “Not only has online commerce returned to prior trends, but the macroeconomic downturn, increased competition, and ads signal loss have caused our revenue to be much lower than I’d expected.”
In July, Meta reported its first-ever revenue drop and revealed disappointing third-quarter results last month as ad sales shrank. Meta’s traditional social media business has faced fierce competition in the form of short-form video app TikTok.
The company’s financial problems also follow Zuckerberg’s attempt to shift toward a new business: building the metaverse, a virtual world where Zuckerberg believes people will connect with others. In October 2021, the Facebook renamed itself Meta to reflect this.