Facebook parent Meta plans to resume hiring in key priority areas after completing layoffs in May 2023, as the company's advertising sales return to growth after three straight quarters of revenue decline on a yearly basis.
Over the past few months, Meta has taken several measures to aggressively cut costs and become a more nimble organisation, as the company embarks on what chief executive Mark Zuckerberg dubbed as a "year of efficiency".
Meta had announced plans to reduce its workforce by 21,000 people, with the first round of 11,000 job cuts happening in November 2022 and the second round of 10,000 layoffs announced in March 2023 and is set to complete in May 2023.
In a statement, Zuckerberg said they are "becoming more efficient so we can build better products faster and put ourselves in a stronger position to deliver our long term vision".
"So far we've gone through two of the three waves of restructuring and layoffs that we had planned for this year - in our recruiting and technical groups. In May, we’re going to carry out our third wave across our business groups" Zuckerberg said during the company's earnings conference call on April 26.
He mentioned that layoffs has been a "difficult process" but after it is done, they will have a "much more stable environment for employees".
For the rest of the year, the company will focus on improving the distributed work model, delivering artificial intelligence (AI) tools to improve productivity, and removing unnecessary processes across the company, Zuckerberg said.
These cost-cutting measures came amid a slow advertising demand due to a tough macroeconomic climate, the significant impact of Apple's iOS privacy restrictions on the social networking giant's advertising business and increased competition from players such as TikTok.
"When we started this work last year, our business wasn't performing as well as I wanted. But now we're increasingly doing this work from a position of strength" Zuckerberg said.
Meta posted a 3 percent year-on-year (YoY) increase in its revenue to $28.6 billion in Q1 2023, while profits fell 24 percent to $5.7 billion, partly due to restructuring charges of $1.1 billion related to severance and facilities consolidation expenses.
The increased sales revenue was also driven by a growth in users. More than 3 billion people now use one of the company's apps - Facebook, Instagram and WhatsApp - on a daily basis as of March 2023, up 5 percent YoY. Facebook has about 2.04 billion daily users as of March 2023, up 4 percent YoY.
As the firm's financial position improves, Zuckerberg believes that slowing hiring, flattening its management structure, rigorously prioritizing projects and increasing the percent of the "company that is technical" will help them improve the speed and quality of their work.
"I also believe that a stronger financial position will enable us to weather a volatile environment while remaining focused on our longer term priorities" he said.
Which areas will Meta hire?
Meta, which had announced a hiring freeze in November 2022, plans to add people in priority areas such as generative AI, ads, infrastructure, and Reality Labs, which houses the firm's virtual reality technologies and projects.
"We would expect headcount growth in excess of 1 percent to 2 percent in 2024 as a result as we ramp up those recruiting pipelines" CFO Susan Li said during the earnings call.
Meta had 77,114 employees across the world at the end of the first quarter, down 10.8 percent from 86,482 employees in the previous quarter.
The company noted that the number no longer includes substantially all employees impacted by the November layoffs. Employees that were impacted by March layoffs are still included in the Q1 headcount.
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