US media reported over the weekend that job cuts could be announced as early as Wednesday.
During Meta’s disappointing third-quarter results, chief executive Mark Zuckerberg said the workforce could fall.
“In 2023, we will focus our investments on a small number of high-priority growth areas,” he said.
Meta has approximately 87,000 employees worldwide across various platforms, including Facebook, Instagram, and WhatsApp.
The job cut plans follow difficulties in the tech sector as the industry continues to slow global economic growth.
Mr. Zuckerberg expects some teams to “stay flat or shrink” next year.
“Overall, we expect 2023 to either end up being roughly the same size or even a slightly smaller organization than it is today,” he said.
Ad-supported platforms such as Facebook and Alphabet’s Google suffer from budget cuts for advertisers as they battle inflation and rising interest rates.
Last Thursday, Silicon Valley firms Stripe and Lyft announced massive layoffs, while Amazon said it would halt hiring at its corporate offices.
Twitter last week laid off nearly half of its 7,500 employees since being acquired by Elon Musk.
Not only is the global economic situation an issue for Meta, but there is also competition from TikTok, privacy concerns from Apple, massive spending on the Metaverse, and concerns about the current threat of regulation.
Mr. Zuckerberg has said he expects the Metaverse investment to take nearly a decade to yield positive results.
In the meantime, he says he will have to restructure the teams to reduce costs.
In June, the social media company cut plans to hire engineers by at least 30%, with Mr. Zuckerberg warning employees of an economic downturn.
Meta shareholder Altimeter Capital Management said in an open letter to Zuckerberg that the company needed to streamline by cutting jobs and capital spending. It added that Meta had lost investor confidence as it increased spending and started focusing on the Metaverse.
The company’s market value has dropped to $600bn (£524bn) in the past year.
Big tech is feeling the sting of the global economic slowdown.
This is because many of these giants, including Meta, rely on digital advertising money, which has now rolled into their billions. This is why platforms like Meta are free for people to use. Instead, they pay in their data and their eyeballs to see the ads shown to them.
Don’t feel too sorry for them because, to an extent, the funds are still visible. The vast majority of this money doesn’t come from big brands but from the millions of small and medium-sized businesses that regularly spend small amounts.
With rising costs and customers spending less money hitting their revenues, one of the first things these companies are likely to do is trim their marketing budgets.
Public companies like Meta are required to release details about their finances every three months.
A few weeks ago, someone who lived with Mark Zuckerberg told me he “doesn’t look like his normal self,”—suggesting that he, too, was shocked by the meltdown.
Now he’s reportedly planning the biggest layoff in Meta’s 18-year history.
