Meta reportedly plans to cut its budget by freezing hiring and restructuring some teams to cope with the slowdown in the growth of the company's advertising revenue.
Meta reportedly announced the major budget cut that entails decelerating hiring and restructuring some teams to cope with the slowdown in the growth of the company's advertising revenue.
As reported by Bloomberg, which cites its internal source, Meta CEO Mark Zuckerberg revealed the plans to reorganize teams and reduce headcount during a weekly Q&A session with employees. Bloomberg's source also claims that in addition to a hiring freeze, the company will cut budgets across most teams, including the "growing" ones.
"I had hoped the economy would have more clearly stabilized by now," Bloomberg quoted Zuckerberg saying. "But from what we're seeing it doesn't yet seem like it has, so we want to plan somewhat conservatively."
At the end of July 2022, Meta reported its first-ever decline in revenue. At the time, the company's financial report revealed that Meta's total revenue in Q2 2022 was $28.82 billion – a 1% decrease compared to the same period last year. The figures reflected in the document also showed that the company's operating income for the quarter fell by 32%, and net income saw a decrease of 36%.
In July, Zuckerberg had already warned that Meta would "steadily reduce headcount growth," and that "many teams are going to shrink so we can shift energy to other areas." And during the recent Q&A, the head of the company again noted that Meta is going to be "somewhat smaller" by the end of 2023 citing the company's first-ever revenue drop.
"For the first 18 years of the company, we basically grew quickly basically every year, and then more recently our revenue has been flat to slightly down for the first time," he reportedly told staff.
Zuckerberg also stated that Meta is slowing hiring as, according to him, the company wants to make sure it's "not adding people to teams where [it doesn't] expect to have roles next year."
You can find the Bloomberg report here. Also, don't forget to join our Reddit page and our Telegram channel, follow us on Instagram and Twitter, where we share breakdowns, the latest news, awesome artworks, and more.