Meta is reportedly planning major releases

CNN business

Facebook parent Meta is reportedly planning the first significant layoffs in its history as the company grapples with a shrinking business and fears of a recession.

The job cuts are expected to affect thousands of workers and could begin as early as this week, the Wall Street Journal reported over the weekend, citing people not familiar with the matter. Meta has more than 87,000 people, according to a September SEC filing.

Meta declined to comment on the report.

In discussing third-quarter earnings results last month, CEO Mark Zuckerberg said the company expects to end 2023 “as roughly the same size, or a slightly smaller organization than it is today.”

Potential cuts have squeezed advertiser budgets and Apple’s iOS privacy changes have affected Meta’s core business. The company reported a drop in its second-quarter revenue last month and reported that its profit had halved from a year earlier. The drop in profitability is largely due to the billions that Meta is spending to build a future version of the internet called the metaverse, which is likely years away.

While it boasted a market capitalization of over $1 trillion last year, Meta is now worth around $250 billion. (After the job cuts were announced, Meta’s shares rose more than 5% on Monday morning.)

Meta is far from the only tech company rethinking the workforce. In a surprising shift in a sometimes intangible industry, Several tech companies have announced hiring freezes or job cuts in recent months, often after experiencing rapid growth during the pandemic.

Last week, ride-hailing company Lyft said it was laying off 13% of its workforce and payment processing company Stripe said it was cutting 14% of its workforce. On the same day, e-commerce giant Amazon said it was putting a hiatus on corporate hiring.

Facebook rival Twitter made major cuts at the company on Friday under its new owner, Elon Musk. The cuts affected its ethical AI, marketing and communications, search and public policy teams, among others.

Since then, however, Twitter ( TWTR ) has reportedly asked for the reinstatement of dozens of laid-off workers, according to Bloomberg.