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| Meta warns employees of bad times |
Mark Zuckerberg told employees that Facebook owner Meta has cut its plans to hire engineers by at least 30% this year and warned them to prepare for a severe economic downturn.
Zuckerberg told employees in a weekly question-and-answer session that this could be one of the worst downturns we've seen in recent history.
Zuckerberg noted that Meta has lowered its engineering hiring target to between 6000 and 7000 by 2022 from an initial plan to hire about 10,000 new engineers.
The company confirmed last month that it was hiring in general, but it hasn't released exact numbers yet.
In addition to the hiring cuts, Zuckerberg said the company has also postponed some job openings in response to employee turnover and increased pressure on performance management to weed out employees who are unable to meet targets.
"In fact, there are probably a lot of people in the industry who shouldn't be here," Zuckerberg said.
The social media and tech company is preparing for a tough second half as it grapples with macroeconomic stress and the impact of data privacy on its advertising business.
Organizations must prioritize more and run a leaner, stronger, and better implementation team.
"I must stress that we are going through a dangerous time and the headwinds are strong," Cox said. We need to get our job done in a slow-growing environment, and teams shouldn't expect the influx of engineers and new budgets.
A keynote speaker said: “The purpose of this note is to build on what we have said publicly about the challenges and opportunities we face.
The rating represents the company's latest approximate forecast. With ad sales slowing and user growth, Meta hopes to cut costs for most of the company's business this year.
All tech companies have scaled back their ambitions in anticipation of a possible recession in the United States. But Meta's share price has fallen more than competitors like Google and Apple.
Meta cuts off its hiring plans
The world's largest social media company has lost about half its value this year. Meta previously reported that Facebook saw its first quarterly decline in the number of daily active users.
The austerity movement comes at a difficult time. It is aligned with two main strategic axes. One is aiming to restructure their social media offerings around discovery to beat the competition from TikTok. And another one based on augmented and virtual reality technology.
“Meta needs to five times the number of GPUs in its data centers by the end of the year to support discovery,” Cox said
The discovery requires additional computing power from artificial intelligence to highlight popular posts on Facebook and Instagram in users' feeds.
Cox said interest in Reels' products is growing rapidly. In the US and around the world, the time users spend on Reels has doubled year by year. About 80% of the growth since March has come from Facebook.
User interaction with the reels enhances the bottom line. Therefore, it is very important to add ads to Reels as soon as possible.
Zuckerberg told investors in April that he considers the reels an essential part of the Discovery engine's vision.
He explained at the time that switching to short videos could slow growth in the short term. But as advertisers become familiar with the format, it will gradually increase sales.
Meta also sees revenue growth potential from enterprise messaging and in-app purchase tools that could mitigate issues with privacy changes led by Apple.
The company's hardware division will focus on the successful launch of the Mixed Reality headset in the second half of the year. These sunglasses are codenamed Cambria.