Cutting Costs and Being More Efficient
It appears that being efficient and cutting costs are helping companies gain value in their stock, so of course they are going to do both of these things.
Meta (Facebook) hasn't done much in the way of innovation besides copying other companies like SnapChat with features, so it continues its path by copying other tech companies in cutting costs and being efficient. The last two, I agree with and think are good steps to take in a business or your own life.
On the Q4, 2022 earnings call, CEO Mark Zuckerberg described the company's near future priorities and plans as painting a picture of a tech giant that is driving toward leaning down and speeding up. The company beat on revenue expectations in the final quarter for 2022 with $32.2 billion total.
Facebook's total user base also increased, hitting about 1.98 billion active daily users and about 2.96 billion monthly active users as of September 2022.
Aggressive cuts were made and a promise of an efficient 2023 drove the stock price up about 20% in after hours trading. In 2022, Meta took a beating, going down by as much as 60%. Other tech stocks faced similar beatings as well, like Tesla.
Meta (Facebook) also became more proactive about cutting projects that aren't performing or may no longer be crucial or relevant. His main focus is on increasing the efficiency of how the company executes its top priorities. This is a stark contrast from the virtual reality focus that Meta had in prior years.
Meta (Facebook) also downsized its staff by cutting about 13% of its workforce. That's about 11,000 jobs cut. I hope that those workers got a severance package that will help them stay afloat until they can find new work.
Zuckerberg also called out Instagram Reels and the company's algorithmic recommendation engine as two major areas of focus in the coming months. The Metaverse was de-emphasized in favor of focusing on efficiency and cost-cutting.
Facebook and Instagram are shifting from being organized solely around people and accounts you follow to increasingly showing more relevant content recommended by AI systems, according to Zuckerberg. Reels are growing quickly, so that is becoming a focus.
What do you think of Meta (Facebook's) cost-cutting measures and layoffs? Are these a good thing?
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