Meta gains on report social-media giant to cut costs at least 10%
META Platforms is cutting costs by at least 10 per cent in the coming months and will rely more on employee attrition as part of the push, according to the Wall Street Journal.
The company, which owns Facebook, Instagram and WhatsApp, has avoided outright layoffs. But Meta is pushing more employees out of the company by reorganising departments and only giving the workers a short time to find new positions, the Journal reported, citing unidentified people familiar with the situation.
The report suggests Meta has gotten more aggressive in its efforts to cut costs. Meta has already said it would slow down hiring and reprioritize key projects and initiatives. During its first-quarter earnings call, the company said annual expenses would be roughly US$3 billion lower than initially projected, trimming an estimated range that had been as high as US$95 billion.
The Menlo Park, California-based company didn’t immediately respond to a request for comment.
Investors initially cheered the cost-cutting news on Wednesday (Sep 21). The stock, which had been down as much as 1.5 per cent earlier in the day, rose nearly 1 per cent to session highs. But it later pared the gains and was down 0.1 per cent as of 1.20 pm in New York.
Meta also has been cutting down on some long-term hardware projects, including a planned dual-camera Apple Watch competitor. The company has even delayed handing out jobs to its summer interns as a way to reduce costs.
Despite the hiring slowdown, Meta reported it had 83,553 full-time employees as of Jun 30, growth of 32 per cent over the previous year. BLOOMBERG
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