An ongoing Meta employee purge now haunts the social media giant, with over 10,000 out of the company’s 87,000 workers bidding goodbye to their jobs. This mass layoff started last Wednesday, November 9, after CEO Mark Zuckerberg announced the act as an effort to mitigate the stock damage the company has sustained.
Everyone knows of Zuckerberg’s rebranding of Facebook Inc. to Meta Platforms Inc., which denotes his move towards the metaverse. However, after a meeting Tuesday, Zuckerberg took accountability of his over-optimism for Meta’s growth, citing this as the main reason for the company’s overstaffed status. To make things worse, the company’s stock price declined by 70% this year.
But the mass layoffs cannot be attributed to the decline in stock price alone, they are also a product of a larger tech issue, with companies like Twitter and Coinbase doing the same. To compensate for the abrupt farewell, Meta’s head of HR declared that each laid-off employee would receive at least four months’ salary as severance pay.
Oculus Quest Pro, a Horseman of the Apocalypse
The metaverse is a fully immersive virtual world only seen in sci-fi movies, sodo far. It is built on fused elements of augmented-virtual reality, and is the epitome of a futuristic world. The metaverse promises an advanced level of entertainment that incorporates many business opportunities in industries such as tourism, advertising and marketing.
Zuckerberg saw this as an immense opportunity for his firm’s growth—a big dream in being a metaverse pioneer. He previously purchased Oculus, a company specializing in virtual reality (VR). Oculus was expected to play a key role in integrating his company with the metaverse.
This enthusiasm for virtual reality birthed the Oculus Quest VR Headset, one of Zuckerberg’s four major platforms in the Meta’s metaverse development pipeline. However, this platform was not as efficient and slick as he originally envisioned it to be.
This high-end ($1,500) headset, unfortunately, received a lot of backlash, as its price was obviously not consumer-friendly. Moreover, most applications in the device havedevice are have not been optimized for use, thus being called as a product “not knowing its target audience.”
Zuckerberg ultimately admitted that building the metaverse is a “massive undertaking” that he was, apparently, not fully prepared for. Perhaps, if Zuckerberg focused more on building his metaverse on a scalable blockchain optimized for efficiency, security, accountability, practicality and handling big data instead of on gadgets like headsets, then Meta would not have been so much in the red.
Figures released on October 26 show that Meta made a revenue of $27.7 billion in the three months approaching September 30—a 4% decline from the same period last year. Operating income was down 46% to $5.66 billion due to nearly 20% rise in costs. Profit reportedly slid down by 52% to just under $4.4 billion.
Financial figures were grim for Meta, as their shares went down sharply in after-hours trading due to investor panic. When the shares opened on October 27, they saw a fall of more than one quarter to $98, which was less than one third of their value when the year began.
The future looks less than optimistic for Meta, as the tech sector is gearing towards a bear market of prices falling. Younger generations, such as Gen-Z, are also not that enthusiastic with Meta’s platforms. TikTok and other up-and-coming social media platforms are seemingly more in-trend than Meta. Time will only tell for Meta’s future.