Meta's pandemic-era growth forecast was too optimistic, Mark Zuckerberg says

The social media company hired too aggressively and failed to account for the possibility of an economic downturn, he tells employees

Meta Platforms chef executive Mark Zuckerberg said he mistakenly expected that a bump in usage and revenue growth during coronavirus lockdowns would be sustained. AP
Beta V.1.0 - Powered by automated translation

Meta Platforms chief executive Mark Zuckerberg told members of staff the world's biggest social media company had planned for growth too optimistically, mistakenly expecting that a bump in usage and revenue growth during coronavirus lockdowns would be sustained.

Mr Zuckerberg, responding to an employee question at a company meeting on Thursday, said he had hired too aggressively and failed to account for the possibility of an economic downturn, according to a person who heard the remarks.

The employee had asked about mistakes Mr Zuckerberg had made, the person said.

The comments were more pointed than those Mr Zuckerberg had delivered during an investor call the day before, after Facebook owner Meta recorded its first quarterly drop in revenue and forecast another fall to come in the third quarter.

On the investor call, Mr Zuckerberg said he believed the economy was entering a downturn that would have a “broad impact” on the digital advertising business.

“It's always hard to predict how deep or how long these cycles will be, but I'd say that the situation seems worse than it did a quarter ago,” he said.

He told investors the company planned to “steadily reduce headcount growth” over the next year.

At the company meeting on Thursday, another employee asked Mr Zuckerberg if senior managers at Meta had been “coasting”, making reference to a debate over the term after an executive this month told managers to “move to exit” any employees who were “coasting” or performing poorly.

Mr Zuckerberg responded by discussing Meta's performance reviews generally, according to the person who heard him speak, as well as another briefed on the response.

The employee who raised the question then took to the comments section of an internal discussion board, writing that in his view Mr Zuckerberg had not answered his question.

The exchanges come as Mr Zuckerberg is battling morale problems at Meta, on top of economic woes and business challenges from Apple and ByteDance's TikTok.

At a tense companywide meeting last month, Mr Zuckerberg told employees he expected them to work with more “intensity”, as he cut hiring targets and raised performance goals that were relaxed during the pandemic.

Meta staff, who like many technology employees are paid partly in stock units, saw their compensation effectively cut this year as the stock price tumbled on news of stalling growth.

Updated: July 30, 2022, 6:56 AM
EDITOR'S PICKS
NEWSLETTERS
MORE FROM THE NATIONAL