CEO Mark Zuckerberg looked jittery as he battled employee questions during an hour-long town hall meeting from Meta Platforms Inc’s META California headquarters.
The workforce peppered Zuckerberg with questions — including why they should have confidence in his leadership. “That’s a completely fair question,” Zuckerberg responded, the Washington Post cites from a meet recording.
Reports indicate Zuckerberg has lost his vision and the trust of his workforce amid its record layoffs and costly investment in the virtual reality “metaverse” with no immediate signs of paying off.
Meta’s core product, Facebook, is trailing behind TikTok in user engagement. Meta also lags on generative artificial intelligence behind the likes of Microsoft Corp MSFT.
Meta insiders say the layoffs and pledges for further cost-cutting have shattered internal resolve. Even the highest ranks of Meta’s leadership, including Chief Technology Officer Andrew Bosworth, blame Zuckerberg for the company’s woes.
Meta grew its employee ranks by double-digit percentage points for years, which accelerated during the pandemic. The headcount nearly doubled between 2019 and 2022 as Meta benefited from an influx of brands using Facebook and Instagram to reach customers. But the performance of e-commerce reversed on pandemic recovery.
Meta’s metaverse products also failed to gain traction. The rebranding could not make a mark leading to the dumping of certain products. Reality Labs lost more than $13.7 billion last year — up from the $10.2 billion it lost in 2021 and the $6.6 billion in 2020.
John Carmack, the former high-ranking consultant for the company’s virtual reality division, quit in December after failing to fix the inefficiencies plaguing the division.
By early 2022, Meta’s optimism started to fade as Meta’s flagship app, Facebook, lost daily users as a public company for the first time in its decade, leading to stock price loss. The losses followed Meta’s plans to downsize, triggering alarm among Facebook’s workforce.
“I got this wrong. It was a big mistake,” Zuckerberg said at the same meeting, referring to his overestimating revenue. “Going forward — what this means — is we have to be a leaner and more capital-efficient company.”
Meta is now in the midst of its second round of layoffs, eliminating 4,000 jobs in May. Since November, Meta has said it would lay off 21,000 employees, or nearly a quarter of its workforce.
At a town hall this month, Zuckerberg delivered a forceful justification of why workers should stay at the company.
Price Action: META shares traded lower by 1.02% at $237.90 on the last check Monday.