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Facebook plans to cut hire as revenue growth slows

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Facebook co-founder and CEO Mark Zuckerberg testified before the Financial Services Committee at the Rayburn House office building on Capitol Hill on October 23, 2019 in Washington, DC. Zuckerberg testified about the proposed cryptocurrency Libra, how his campaign will handle false and misleading information of political leaders during the 2020 campaign and how it handles the data and privacy of its users.

Chip Somodevilla | News Getty Images | Getty Images

Facebook father The goal slows the pace of hiring as it is considered to have the weakest revenue growth of all time and ongoing business challenges such as Apple’s privacy changes and the war in Ukraine.

“We regularly re-evaluate our talent channel according to the needs of our business, and in light of the cost benchmarks given for this profit period, we are slowing its growth accordingly,” a Meta CNBC spokesman said in an email Wednesday. “However, we will continue to build up our workforce to ensure we focus on long-term impact.”

In last week’s Meta earnings report forecast potential revenue decline for the year in the second quarter. CFO David Venus highlighted several challenges facing the company, and said annual spending would range from $ 87 billion to $ 92 billion compared to a previous forecast of $ 90 billion to $ 95 billion.

According to a person familiar with the company’s plans, Meta intends to suspend or slow down hiring for most middle- and senior-level positions after delaying the addition of entry-level engineers in recent weeks. Recruiters have begun to suspend their efforts to perform certain roles, the man said.

Insider reported plans earlier with reference to a Venus memo to staff.

The struggle began to emerge last year when users abandoned Facebook apps. In February, Said Meta its daily active users for the first time consistently declined in the fourth quarter, although that number increased again in the first quarter of 2022.

However, the digital media business as a whole is being hit by macroeconomic problems and Russia’s invasion of Ukraine.

“We have seen a further slowdown since the start of the war in Ukraine due to the loss of revenue in Russia, as well as declining demand for advertising both in Europe and outside the region,” Venus said in last week’s earnings report. “We believe that the war has brought additional volatility to an already uncertain macroeconomic landscape for advertisers.”

Venus reiterated to investors that Apple has made changes to privacy its iOS devices last year will hurt growth after the company had already predicted the move would cut revenue this year by $ 10 billion.

On Wednesday, the Federal Reserve raised its benchmark interest rate is half a percentage point in an attempt to eliminate a 40-year high of inflation. Markets have risen as Fed Chairman Jerome Powell has revealed that the central bank is unlikely to introduce a bigger rate hike in the future than this.

Facebook shares ended the day 5% higher, although they still fell 34% for the year.

WATCH: Jim Kramer says he would buy Facebook shares after earnings hit, but it’s too early for a “winning circle”

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