Facebook plans to cut hiring as revenue growth slows
Facebook co-founder and CEO Mark Zuckerberg testifies before the House Financial Services Commission in the Rayburn House Office Building on Capitol Hill on October 23, 2019 in Washington, DC. Zuckerberg testified about Facebook’s proposed Libra cryptocurrency, how his company will handle false and misleading information from political leaders during the 2020 campaign, and how it will manage its users’ data and privacy.
Chip Somodevilla | Getty Images News | Getty Images
Facebook parent A half is slowing the pace of hiring as it takes into account the weakest revenue growth ever recorded and ongoing business challenges, such as Apples The changes in privacy and the war in Ukraine.
“We regularly evaluate our talent pipeline based on our business needs and in light of the expense guidance provided for this earnings period, we are slowing its growth as a result,” a Meta spokesperson on CNBC said Wednesday in an e-mail address. -mail. “However, we will continue to grow our workforce to ensure we focus on long-term impact.”
In its earnings report last week, Meta forecast a potential decline in year-over-year revenue in the second quarter. CFO David Wehner highlighted several problems the company faces and has said that expenses for the year would be between $ 87 billion and $ 92 billion, down from a previous forecast of $ 90 billion to $ 95 billion.
Meta intends to discontinue or slow down hiring for most mid- and senior-level roles, after holding back the addition of entry-level engineers over the past few weeks, according to a person familiar with the company’s plans. Recruiters have begun to suspend their efforts to fill certain roles, the person said.
insider reported on the plans earlier, quoting a memo from Wehner to employees.
The struggles began to emerge last year when users ditched the Facebook apps. in February, Meta said its daily active users declined sequentially for the first time in the fourth quarter, although that number rose in the first quarter of 2022.
However, the digital media business in general is taking a hit due to macroeconomic concerns and the Russian invasion of Ukraine.
“We have experienced a further slowdown in growth since the start of Ukraine was due to the loss of revenue in Russia and the reduction in advertising demand both in Europe and outside the region,” Wehner said during last year’s earnings call. week. “We believe the war has introduced further volatility in an already uncertain macroeconomic landscape for advertisers.”
Wehner reiterated to investors that the privacy changes introduced by Apple its iOS devices last year will hurt growth, after the company already predicted the move would cut revenue this year by $ 10 billion.
Federal Reserve Wednesday raised its benchmark interest rate of half a percentage point in an effort to tackle a 40-year inflation spike. Markets moved higher as Fed Chairman Jerome Powell indicated that the central bank is unlikely to impose higher rate hikes than in the future.
Shares of Facebook ended the day up 5%, although they are still down 34% for the year.