Meta Earnings Report—Looks for Layoffs, Lesser Focus on Metaverse

The first quarter of financial year 2023 ended on March 31 and the social media giant Meta, formerly Facebook, brought its earnings report. The report released on Wednesday, April 26, showcased the company’s performance in the last quarter while also inferring its future outlook. Among several crucial talking points, the positive future outlook, potential restructuring and layoffs, and the metaverse-focused unit of the company had its spot, especially about its loss making operations.

Meta Looks to Continue Last Quarters Performance

Meta generated a revenue of $28.645 Bn during Q1, 2023, better than previous quarter’s $27.908 Bn. In addition, the company has witnessed a rise in several other crucial sectors, including daily and monthly active users. Both the sectors rose during the quarter 2.04 Bn and 2.99 Bn until March 2023, with a growth of 4% and 2% respectively.

The advertisement impressions rose to 26%, however, the average price per ad declined by 17% during the quarter. Along with this, the company noted the existing long term debt of $9.92 Bn in its earnings.

Founder and CEO, Mark Zuckerberg, said, “We had a good quarter and our community continues to grow.” He added the artificial intelligence (AI) related activities in the company are going good and bring fruitful results from apps and business.

“We’re also becoming more efficient so we can build better products faster and put ourselves in a stronger position to deliver our long term vision.”

Overall headcount within the company, after last year’s layoffs, accounts for 77,114 employees in its workforce. For the future, Meta is looking to reduce the staff, especially people working in its Family of Apps (FoA) and augmented and virtual reality segment, Reality Labs.

Eliminating Workforce, Distributing Focus on Metaverse and AI Zuckerberg stated this year as “year of efficiency” for Meta—which indicates towards layoffs like cost cutting initiatives. As reported, the company could see to reduce up to 21,000 employees from its workforce in the later part of this year.

The shrink in the company’s size is broadly taken as the recovery of losses incurred by its metaverse initiatives. Reality Labs in the quarterly loss of $3.99 Bn with the revenue generated $339 Mn within the same timeframe. Moreover, it is expected to suffer more operational losses in the months to come this year.

With this, the company is also engaging in bolstering its artificial intelligence (AI) capabilities while noting its capital expenditure to stay around $30 to $33 Bn. This would be focusing on increasing AI capacity and deploying it to support the company’s advertisements, feeds and reels and other generative AI initiatives.

Andrew is a blockchain developer who developed his interest in cryptocurrencies while his post-graduation. He is a keen observer of details and shares his passion for writing along with being a developer. His backend knowledge about blockchain helps him give a unique perspective to his writing