"Meta Platforms Inc. is planning to begin large-scale layoffs this week ... in what could be the largest round in a recent spate of tech job cuts after the industry's rapid growth during the pandemic," according to the Wall Street Journal.
The Gateway Pundit, meanwhile, reported that "Meta-Facebook shares were down more than 24 percent a couple weeks ago on a weak Q4 forecast and earnings collapse."
And that means the fortune of Facebook co-founder and CEO Mark Zuckerberg has taken an enormous hit.
"Mark Zuckerberg's fortune plunged by $11 billion after his Meta Platforms Inc. reported a second-straight quarter of disappointing earnings, bringing his total wealth loss to more than $100 billion in just 13 months," Bloomberg News said in a report.
Based on a report from CNBC, Facebook (Meta) stock dropped more than 73 percent over the year and has lost $800 billion of its market cap.
Facebook went down from a 52-week high of $353 per share to $92 per share on Wednesday, November 2.
Facebook's market capital down to almost $245 billion
Last summer Facebook's market capital was almost $1 trillion dollars. Now, it is down to $245 billion.
According to analyst Gene Munster, a managing partner at Loup, which invests in Meta, the staff cuts would be the biggest by any of the Big Tech corporations.
Details of Meta's plans emerged after Twitter's new boss Elon Musk laid off around 3,750 employees, becoming the most recent tech firm to carry out a massive job cut. (Related: Social media giant Twitter announces layoffs amid snags in Elon Musk deal.)
Munster said the layoffs are "totally necessary" and he also said Meta is actually expected to hire thousands of employees next year as it proceeds to funding its struggling Metaverse unit, Reality Labs.
"In this case, Meta's probably going to cut – they haven't given the specific numbers – 10 percent, which will be the largest headcount of any of the big tech companies," Munster said. "It's a step in the right direction."
Meta, which owns Facebook, Instagram and WhatsApp, has almost 87,000 employees, so a projected 10 percent slash of its workforce would more than double the number of people sacked by Twitter.
The company's stock went up more than five percent on Monday, Nov. 7, following news of the cuts. Still, it is a stunning 71.5 percent lower than at the start of 2022.
"In some ways, I'm a little bit surprised to see the stock reaction given Zuckerberg talked about this on their earnings call a couple weeks ago. Specifically, he said headcount would effectively remain flat a year from now, so what's essentially going on is they are reducing headcount by 10 percent, and they will be adding headcount within the Metaverse," Munster said.
I think when you put all this together, it’s some welcome relief for Meta investors. It’s good that they are showing some fiscal responsibility, but still, the future of Meta is going to be largely dependent on the Metaverse – what direction that moves in."
Meta has spent billions and hired thousands of employees around the globe to create the Metaverse, which refers to a shared digital environment that employs augmented or virtual reality technology to make it more realistic. But Reality Labs, a Metaverse's unit that works on augmented and virtual reality, has repeatedly reported massive losses.
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