Layoffs 2023: It costs Meta more than Rs 8,000 crore to fire 21,000 employees
By Ankita Garg: Meta has been firing employees on a large scale to save costs, but it seems that the company is also paying a big cost for the same. In its SEC filing for its first Quarter 2023 Results, Meta has revealed details about how much it needs to pay laid-off employees as part of the compensation package for taking away their jobs.
Meta reported that it expects to incur a total pre-tax severance and related personnel costs of around $1 billion, which is more than Rs 8,000 crore in India when converted. The company says that it has already spent millions as part of its restructuring costs, which includes severance pay and other benefits that the company has promised to impacted employees.
The SEC filings also revealed that Meta is benefiting from its layoff decision and other cost-cutting measures because the company’s Q1 FY 2023 revenue stood at $28.65 billion, which is 3 percent higher year-over-year, and an increase of 6 percent year-over-year on a constant currency basis.
In its filing, the tech giant says, “In 2022, we initiated several measures to pursue greater efficiency and to realign our business and strategic priorities. As of March 31, 2023, we have substantially completed the 2022 employee layoffs while continuing to assess facilities consolidation and data center restructuring initiatives. We incurred additional pre-tax restructuring charges of $621 million in the first quarter of 2023.”
“In March 2023, we announced three rounds of planned layoffs to further reduce our company size by approximately 10,000 employees across the Family of Apps (FoA) and Reality Labs (RL) segments. In connection with these layoffs, we expect to incur total pre-tax severance and related personnel costs of approximately $1 billion, of which $523 million was recognized during the first quarter of 2023 and the remaining charges will be substantially recorded by the end of 2023,” Meta added.
The company started layoff in November 2022 after several big tech companies sacked thousands of employees n 2022. The tech giant initially announced 11,000 job cuts around 6 months back to cut expenses, streamline its business and make its revenue growth stable. Earlier this year, it realized that Meta will have to remove more employees and take other measures to achieve its goal.
