Meta Experiencing ‘One of the Worst Downturns in Recent History’

Following massive losses in its Reality Labs division, Meta CEO Mark Zuckerberg has reportedly told employees that the company is experiencing “one of the worst downturns [it has seen] in recent history.”

According to Reuters, Zuckerberg says Meta is cutting targets for new engineer hires this year by 30%. Instead of hiring 10,000 new engineers as planned, the company is expected to only bring on between 6,000 and 7,000 new people. This report comes after the company already revealed that it would slow hiring in 2022 due to weak revenue forecasts, Engadget reported in May.

In an internal memo published by The Verge, Meta chief product officer Chris Cox indicated that Meta would be raising expectations on current employees and setting more aggressive goals for them so they could decide if working at the company was the right fit for them.

“I have to underscore that we are in serious times here and the headwinds are fierce. We need to execute flawlessly in an environment of slower growth, where teams should not expect vast influxes of new engineers and budgets,” Cox writes. “We must prioritize more ruthlessly, be thoughtful about measuring and understanding what drives impact, invest in developer efficiency and velocity inside the company, and operate leaner, meaner, better exciting teams.”

Cox says that Meta’s biggest challenges are linked to changes in revenue that are coming from privacy changes and that the company will be focusing on monetizing reels “as quickly as possible.”

Instagram’s TikTok clone Reels is one of the few “bright spots” for the company, according to Cox, and the business will heavily lean on the feature moving forward in 2022.

The company has already canceled or reframed multiple consumer products including a camera-equipped smartwatch. Meta is also discontinuing Portal devices for consumers and is repositioning them as business products.

Meta has also lost billions of dollars through its Reality Labs division, the portion of the company dedicated to virtual reality and metaverse products. That division lost $10.2 billion in 2021 which followed a $6.6 billion loss the previous year. Zuckerberg’s goals for the company heavily lean on his vision of the future in the metaverse, but none of the endeavors linked to that have proven profitable as of yet.

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