Facebook owner Meta Platforms told employees on Friday that it would stop developing smart displays and smartwatches and that nearly half of the 11,000 jobs it eliminated this week in an unprecedented cost-cutting move were technology roles.
Speaking during an employee townhall meeting heard by
Reuters, Meta executives also said they were reorganising parts of the company,
combining a voice and video calling unit with other messaging teams and setting
up a new division, Family Foundations, focused on tough engineering problems.
The executives said that the first mass layoff in the social
media company's 18-year history affected staffers at every level and on every
team, including individuals with high performance ratings.
Overall, 54% of those laid off were in business positions
and the rest were in technology roles, Meta human resources chief Lori Goler
said. Meta's recruiting team was cut nearly in half, she said.
The executives said further rounds of job cuts were not
expected. But other expenses would have to be cut, they said, noting reviews
underway about contractors, real estate, computing infrastructure and various
products.
Smart devices cut
Chief technology officer Andrew Bosworth, who runs the
metaverse-oriented Reality Labs division, told staffers Meta would end its work
on Portal smart display devices and on its smartwatches.
Meta had decided earlier this year to stop marketing Portal
devices, known for their video calling capabilities, to consumers and focus
instead on business sales, Bosworth said.
As the economy declined, executives decided more recently to
make "bigger changes," he said.
"It was just going to take so long, and take so much
investment to get into the enterprise segment, it felt like the wrong way to
invest your time and money," said Bosworth.
Portal had not been a major revenue generator and drew
privacy concerns from potential users. Meta had yet to unveil any smartwatches.
Bosworth said the smartwatch unit would focus instead on
augmented reality glasses. More than half of the total investment in Reality
Labs was going to augmented reality, he added.
Chief Executive Officer Mark Zuckerberg on Friday reiterated
his apology from Wednesday about having to cut 13% of the workforce, telling
employees he had failed to forecast Meta's first dropoff in revenue.
Meta aggressively hired during the pandemic amid a surge in
social media usage by stuck-at-home consumers. But business suffered this year
as advertisers and consumers pulled the plug on spending in the face of soaring
costs and rapidly rising interest rates.
The company also faced increased competition from TikTok and
lost access to valuable user data that powered its ad targeting systems after
Apple made privacy-oriented changes to its operating system.
"Revenue trends are just a lot lower than what I
predicted. Again, I got this wrong. It was a big mistake in planning for the
company. I take responsibility for it," Zuckerberg said.
Going forward, he added, he was not planning to
"massively" grow headcount of the Reality Labs unit.
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