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Facebook Plans Fewer "Faces"

FOLE: Facebook icon. Taken October 10, 2022

Facebook parent Meta Platforms Inc. is planning to begin large-scale layoffs this week that will affect thousands of employees, the Wall Street Journal reported on Sunday citing people familiar with the matter, with an announcement planned as early as Wednesday.

Meta Chief Executive Mark Zuckerberg has said he has had to freeze hiring, shutter projects and reorganize teams to trim costs, as well as shrink the company's workforce.

The social media company had in June cut plans to hire engineers by at least 30%, with Zuckerberg warning employees to brace for an economic downturn.

"In 2023, we're going to focus our investments on a small number of high priority growth areas. So that means some teams will grow meaningfully, but most other teams will stay flat or shrink over the next year. In aggregate, we expect to end 2023 as either roughly the same size, or even a slightly smaller organization than we are today" Zuckerberg said on the last earnings call in late October.

The move comes as META stock has tumbled from $141 a share on October 4 to Friday's close at $90.79. Since January 1, 2022, Meta shares have fallen some 70%.

Meta shareholder Altimeter Capital Management, in an open letter to Mark Zuckerberg, had previously said the company needs to streamline by cutting jobs and capital expenditure, adding that Meta has lost investor confidence as it ramped up spending and pivoted to the metaverse.

Meta's moves come as other social media and internet concerns, including Microsoft Corp., Twitter Inc., and Snap Inc., have cut jobs and scaled back hiring in recent months as global economic growth slows due to higher interest rates, rising inflation and an energy crisis in Europe.