Meta Announces Plans To Slow Recruiting After Tough Quarter

“We are regularly reviewing our talent portfolio in line with the needs of our business, and in light of the spending guidance given for this revenue period, we are slowing growth accordingly,” Meta spokeswoman Andrea Beasley said in a statement. The company continues to plan to “grow our workforce to focus on long-term impact,” it said in a statement.

The company currently has no layoff plans, but the slowdown in hiring marks a reversal of aggressive workforce growth during the first three months of 2022. As of March 31, the company’s headcount was 77,805 people, up 28% compared to the same period last year with 5,800 people. net new employee adds during the first quarter. Meta plans to slow down or stop hiring for most middle and senior positions, and recently also suspended hiring of young engineers. Business Insider first reported on Meta’s plan to slow down hiring.

Meta (FB) shares fell nearly 7% on Thursday.
The announcement comes a week after Meta reported its slowest revenue growth in the last three months of 2022, with earnings down 21% year-over-year. Revenue for the current quarter is forecast to be between $28 billion and $30 billion, almost flat from the $29 billion generated in the previous year’s quarter.
Meta is in the midst of trying to change its strategy to focus on its future plans for augmented reality and virtual reality. The company is also facing stiff competition from competitors such as TikTok, loss of business in Russia, difficulty monetizing critical video content, and problems in its advertising business due to Apple’s privacy changes. Last week, Meta reported that the average cost per ad in the first quarter was down 8% year-over-year.

Despite the fact that The company cut its full-year spending estimate by about $3 billion last week, Zuckerberg warned investors that Meta plans to slow down the pace of some investments due to the current challenging growth outlook.

“After the start of Covid, the acceleration of e-commerce led to excessive growth in revenue, but now we are seeing that trend is receding,” Zuckerberg said during a call with analysts. “Based on the strong revenue growth we saw in 2021, we have launched a number of multi-year projects to accelerate some of our long-term investments… but given the current level of growth in our business, we are now planning to slow down. some of our investments.”

During the call, Zuckerberg discussed how the company will focus on several key areas of investment, such as short-form video and an immersive future form of the Internet, which the company is calling the “metaverse.”

“We direct most of the energy within the company to these high priority areas,” he said. “We have a lot of great people here, and a lot of the decisions we have to make on a day-to-day basis are how to channel the really talented people that are already in the company…instead of always relying on getting everything more and more new people from outside.”

Zuckerberg also said that Meta is looking to generate enough operating income growth from its app family in the coming years to fund its investment in Reality Labs while continuing to increase the company’s overall profitability, but warned of short-term challenges.

“Of course, our priority remains building for the long term, so while we are currently building our plans to achieve this goal, it is possible that prolonged macroeconomic or business uncertainty could force us to compromise on shorter-term financial goals.” Zuckerberg said. “But we remain confident in our long-term options.”

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