Meta shares rise after the Facebook parent lays off over 11,000 employees as it cuts costs
- Meta shares rose 7.5% Wednesday after the company said it will lay off over 11,000 workers.
- The Facebook parent laid out a narrower range of costs for next year in a regulatory filing.
Meta Platforms shares rose Wednesday after the Facebook parent said it will lay off more than 11,000 employees as it looks to cut costs.
Its CEO Mark Zuckerberg said in a letter to employees Wednesday that the tech giant would cut around 13% of its workforce and extend its current hiring freeze until the end of March next year.
Meta's stock was up 7.53% at $103.71 at last check, as investors digested the job cuts and other cost reductions outlined by the company, which downgraded its fourth-quarter guidance when issuing a dismal earnings report in October.
In an 8-K filing published Wednesday, Meta cut its expense guidance for next year, from between $96 billion and $101 billion to between $94 billion and $100 billion.
The moves come after Meta delivered downbeat guidance on growth and its digital ads business in the last quarter of 2022. Right after the financial update last month, its shares sank just under 20%.
Meta's stock has now plummeted 71% year-to-date, as rising interest rates and mounting fears of a recession cause investors to sound the alarm about a slowdown in digital ad spending.
The company said Wednesday it expects the losses to continue piling up for its metaverse-focused Reality Labs division, which has already lost the company around $9 billion so far this year.
Zuckerberg acknowledged he had made missteps in big investments by Meta.
"I want to take accountability for these decisions and for how we got here," he wrote. "I know this is tough for everyone, and I'm especially sorry to those impacted."
The company said the 16-week severance packages it's offering laid-off employees wouldn't have any material impact on its costs.
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