Meta’s 5th Round of Layoffs Begins After Mark Zuckerberg Made World’s Second Richest Man
Meta has announced a further round of layoffs. | Credit: Matt McClain/The Washington Post via Getty Images
Key Takeaways
- Meta has embarked on its fifth round of layoffs in two years.
- Staff at WhatsApp, Instagram, and Reality Labs are reportedly affected.
- The job cuts have helped Meta achieve significant stock market gains in 2024, boosting CEO Mark Zuckerberg’s net worth.
Meta has initiated its fifth round of layoffs since CEO Mark Zuckerberg declared the company’s “year of efficiency” in 2022.
As the firm continues to streamline its operations and cut expenditures, those efforts are paying off. In 2024, Meta’s share price has more than doubled while Zuckerperg’s personal fortune surged by nearly 90%.
Meta’s Latest Layoffs
As first reported by The Verge, Meta has begun laying off employees across various departments, including WhatsApp, Instagram and its Metaverse unit Reality Labs.
The exact number of employees impacted is unclear, but The Verge indicated that the latest rounds of job cuts aren’t as deep as previous ones.
“Today, a few teams at Meta are making changes to ensure resources are aligned with their long-term strategic goals and location strategy,” a company spokesperson told the publication. “This includes moving some teams to different locations, and moving some employees to different roles. In situations like this when a role is eliminated, we work hard to find other opportunities for impacted employees.”
Five Rounds of Layoffs Since 2022
Meta’s latest headcount reduction marks the company’s fifth set of layoffs since November 2022, when it laid off over 11,000 employees, representing approximately 13% of its workforce at the time.
The company continued to cut jobs in early 2023, with another 10,000 layoffs announced between March and April.
Including the latest redundancies, Meta has executed three more layoff rounds of unknown size since then.
Of course, Meta isn’t alone in this trend. The tech industry has seen a general downsizing, with companies like Amazon, Google, and Microsoft laying off tens of thousands of employees since 2022.
Zuckerberg Briefly Becomes World’s Second-Richest Man
With a roughly 13% stake in the business, Zuckerberg has been a major beneficiary of Meta’s stock market gains.
Earlier this month, Bloomberg’s Billionaires Index reported that he briefly became the world’s second-richest man as his net worth surpassed $200 billion.
While he has since been pushed into third place by Jeff Bezos, the Facebook Founder remains close to the top of the list.
Meta’s “Year of Efficiency”
In 2022, Meta faced declining daily Facebook users and a huge $200 billion loss in market value. In response, Zuckerberg announced Meta’s “Year of Efficiency,” making tough decisions like laying off 21,000 employees and refocusing the company on AI.
On March 14, 2024, the company shared an update with their employees:
“Over the next couple of months, org leaders will announce restructuring plans focused on flattening our orgs, canceling lower priority projects, and reducing our hiring rates.”
Although considered an aggressive move, it nonetheless sent a clear message to investors: Meta was serious about getting leaner and more focused. In addition to layoffs, Meta’s move into AI appears to have reassured investors that Meta was focused on their future strategy.
Moving Away From Metaverse
Microsoft recently announced it will discontinue its HoloLens mixed reality headsets as the company shifts its focus to AI. Once touted as a key focus, the metaverse has now also very much been sidelined by Meta.
The move comes as BigTech companies shift resources to more profitable areas.
With investors continuing to pour billions into companies such as Nvidia, Meta’s pivot to focus on the AI sector has become one of its greatest advantages. In particular, AI’s potential to drive engagement on Meta’s social media platforms and fuel its advertising algorithms has contributed to the bullish outlook on Meta shares.
With additional reporting from James Morales.
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