Following the lead of rival social media outlet Twitter, Facebook-owner Meta reportedly plans large-scale layoffs that could hit thousands of employees this week. Meta stock climbed on the news Monday.
According to a report by the Wall Street Journal, the announcements that "many thousands of people" will be cut could come as soon as Wednesday. Meta says it employs 87,000.
The WSJ report said Meta has told employees to cancel nonessential travel beginning this week. It would be the first large reduction of employees in the company's 18-year history.
Focusing On 'High Priority Areas'
Meta stock jumped 6.5% to close at 96.72 on the stock market today.
Meta declined to comment. However, during last month's quarterly earnings call Chief Executive Mark Zuckerberg said, "In 2023, we're going to focus our investments on a small number of high-priority growth areas."
In addition, he said, "That means some teams will grow meaningfully, but most other teams will stay flat or shrink over the next year. In aggregate, we expect to end 2023 as either roughly the same size, or even a slightly smaller organization than we are today."
Meta Stock: Rivals Initiate Layoffs
The round of layoffs by Meta follows that of rival Twitter. The new owner of privately held Twitter, Tesla Chief Executive Elon Musk, is cutting half the staff, or 3,700 people. But reports over the weekend said Twitter asked some laid off workers to come back.
Further, Amazon last week said it would pause corporate hiring. Among other companies, ride-hailing company Lyft said it would cut 700 jobs, about 13% of its workforce.
Also, Stripe last week said it expects to cut 14% of staff. Reports cited a note Chief Executive Patrick Collison sent to his staff. In it, he cited "stubborn inflation, energy shocks, higher interest rates, reduced investment budgets and sparser startup funding."
Meta stock is down 72% this year.
Please follow Brian Deagon on Twitter at @IBD_BDeagon for more on tech stocks, analysis and financial markets.
