Meta, the parent company of Facebook, Instagram and WhatsApp, is reportedly gutting thousands of jobs amid shareholder unease and a broader pullback in tech.
The Menlo Park-based company could begin notifying employees of the mass layoff as soon as Wednesday, the Wall Street Journal reported. It would be the first large-scale layoff in the company's 18-year history.
Bay Area tech firms are increasingly feeling the heat as interest rates rise and talk of a recession grows louder. Several local companies, including Lyft, Stripe and Zendesk, announced layoffs last week.
Twitter issued a notice to the state that approximately 784 employees at its San Francisco office will be officially terminated in January 2023 in the wake of billionaire Elon Musk’s takeover of the social network.
Meta’s stock has been battered amid investor skepticism around the company’s heavy investments into the metaverse, a virtual world concept that founder and CEO Mark Zuckerberg views as the future of social networking. The company’s stock has fallen roughly 70% year to date.
A Facebook spokesperson declined to comment, but pointed to Zuckerberg's pledge on an Oct. 26 earnings call 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," Zuckerberg said.
Zuckerberg, who has "super-voting” rights at Meta that give him outsized control over the company, has plowed billions into the metaverse even as the nascent software drew widespread mockery for its amateurish graphics and lack of a user base.
Horizon Worlds, Meta’s flagship metaverse, had a meager 200,000 users as of last month according to CNBC.
Meta shareholders were infuriated by the company’s recent earnings report, with some calling Zuckerberg tone-deaf for dumping money into the metaverse as Meta's core advertising business shrinks.
Zuckerberg’s personal wealth has plummeted by more than $100 billion over the past 13 months—the largest drop of any billionaire, according to Bloomberg.
Facebook is among the Bay Area’s largest tech employers and reported 87,000 total employees in September.
Other local tech firms that have cut jobs in recent months include Salesforce, Twilio and Opendoor.