Meta saw its first-ever quarterly drop in revenue yesterday as its digital ad sales were put under pressure. In an earnings call to investors, Meta CEO Mark Zuckerberg said that (PDF) he will be looking for ways that the company can do more with less. As the economy slows, customers are buying less and the demand for Meta’s digital ad services is falling, so Meta earns less.
In the earnings call, Zuckerberg said:
“Given the continued trends, this is even more of a focus now than it was last quarter. Our plan is to steadily reduce headcount growth over the next year. Many teams are going to shrink so we can shift energy to other areas, and I wanted to give our leaders the ability to decide within their teams where to double down, where to backfill attrition, and where to restructure teams while minimizing thrash to the long term initiatives. The fact that we hired a lot of people earlier this year means that our reported year-over-year headcount growth will still be substantial for the next few quarters, but it should continue to decline over time.”
While it’s a time of cutbacks for Meta, its CEO remains optimistic in one sense. He said that other challenging periods in the company’s past have helped to develop the company’s next-generation of leaders. He says that the current period will be similar and will identify other effective employees.
One of the main questions people are asking about the American economy is whether it has entered a recession or not. The Meta CEO seems to think so. He said it looks like the country has entered an “economic downturn” – these are contrary beliefs to those espoused by Federal Reserve Chair, Jerome Powell, who said he doesn’t think the U.S. is yet in a recession.