In a message shared with Meta employees on Wednesday morning, Zuckerberg said he was making “some of the most difficult changes we’ve made in Meta’s history.”
“We are also taking a number of additional steps to become a leaner and more efficient company by cutting discretionary spending and extending our hiring freeze through Q1,” Zuckerberg said. “I want to take accountability for these decisions and for how we got here. I know this is tough for everyone, and I’m especially sorry to those impacted.”
Zuckerberg took the opportunity to explain what led Meta to this point and why the decision was made in his company-wide message.
“At the start of Covid, the world rapidly moved online and the surge of e-commerce led to outsized revenue growth. Many people predicted this would be a permanent acceleration that would continue even after the pandemic ended. I did too, so I made the decision to significantly increase our investments,” said Zuckerberg. “Unfortunately, this did not play out the way I expected. Not only has online commerce returned to prior trends, but the macroeconomic downturn, increased competition, and ads signal loss have caused our revenue to be much lower than I’d expected. I got this wrong, and I take responsibility for that.”
Meta reported a second consecutive quarter of declining sales last month, as the company contends with a widespread drop in online ad spending and rising competition from TikTok.
The layoffs on Wednesday mark the latest in a series of challenges for Meta this year, including the announcement in June that Chief Operating Officer Sheryl Sandberg would depart the company as well as difficulty yielding revenue from its multi-billion-dollar investment in its metaverse project.
The company has drawn criticism from some investors over its large investment in its metaverse project, which has yet to deliver significant returns.