Meta Layoffs Hit Tech Team Hard, Restructuring Continues, Say Execs
Facebook owner Meta Platforms told workers on Friday that it will stop making smart displays and smartwatches and that about half of the 11,000 jobs it cut this week in unprecedented cost-cutting were technology roles.
Speaking at a staff meeting in the city covered by Reuters, Meta executives also said they are reorganizing parts of the company, merging the voice and video calling division with other messaging teams and establishing a new division, Family Foundations, to focus on difficult engineering problems.
Management said the first mass layoffs in the social media company’s 18-year history affected employees at all levels and across teams, including people with high performance ratings.
Overall, 54 percent of those laid off were in business positions and the rest were in technical roles, said Meta CEO Lori Goler. The Meta recruitment team has been cut almost in half, he said.
Management said they did not expect more rounds of job cuts. But some costs will have to be reduced, they said, in view of ongoing reviews of contractors, housing, computer infrastructure and various products.
Smart Devices Cut
Chief Technology Officer Andrew Bosworth, who heads Reality Labs’ metaverse division, told employees that Meta will end its work on Portal smart display devices and its smartwatches.
Meta decided earlier this year to stop selling Portal devices, known for their video calling capabilities, to consumers and focus on business sales, Bosworth said.
As the economy slumps, management has decided to make “big changes” recently.
“It was going to take so long, and it would take so much money to get into that part of the business, it just seemed like the wrong way to invest your time and money,” Bosworth said.
The site was not a huge revenue generator and drew privacy concerns from potential users. Meta should have introduced any smartwatches.
Bosworth said that the smartwatch unit will focus on enhanced reality glasses. More than half of the total investment in Reality Labs will be in augmented reality, he added.
Chief Executive Mark Zuckerberg on Friday also apologized from Wednesday for having to cut 13 percent of the workforce, telling employees that he failed to predict Meta’s initial decline in revenue.
Meta was aggressively recruited during the crisis amid the rise of social media use by homebound consumers. But business has suffered this year as advertisers and consumers struggle to spend in the face of rising costs and rapidly rising interest rates.
The company also faced increasing competition from TikTok and lost access to valuable user data that powers its ad targeting programs after Apple made privacy-focused changes to its operating system.
“Revenue trends are much lower than I predicted. Once again, I got this wrong. It was a big mistake in planning the company. I take responsibility for it,” said Zuckerberg.
Going forward, he added, he wasn’t planning to “significantly” increase the size of the Reality Labs division.
© Thomson Reuters 2022
