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Tech profits and layoffs both soared, Meta Zuckerberg talks about AI has nothing to do with it

Tech profits and layoffs both soared, Meta Zuckerberg talks about AI has nothing to do with it

February 19 , 2024 0

After a year of large-scale layoffs in 2023, many technology companies have continued to lay off employees while sales profits have increased sharply and stock prices have soared. At present, the industry is facing two major challenges, on the one hand, to adapt to the frenzied workforce expansion during the pandemic, and on the other hand, to aggressively move into the field of artificial intelligence.

After a year of large-scale layoffs in 2023, many technology companies have continued to lay off employees while sales profits have increased sharply and stock prices have soared.

At the beginning of this year, Google laid off nearly 1,000 people, mainly responsible for Pixel, Nest and Fitbit hardware devices and services team will face restructuring, Google voice assistant department, augmented reality (AR) department most employees will face dismissal, Fitbit co-founders James Park and Eric Friedman, along with other Fitbit leaders, are also leaving Google. Amazon then cut hundreds of jobs in its Prime video division. Meta has quietly streamlined middle management. Microsoft is also cutting 1,900 jobs in its gaming divisions such as Activision Blizzard.

Google's chief executive, Sundar Pichai, has warned employees that more job cuts are coming this year as the company continues to shift investments to areas such as artificial intelligence.
At present, the "wave of layoffs" swept the technology industry, after the launch of ChatGPT, which led to the AI craze, there are many views to discuss and cause concern, such as AI will replace human jobs, and some people will face unemployment.
Ai projects continue to become a big priority for the company, but CEO Mark Zuckerberg believes in an interview that, at least for Meta, AI is not the main driver of layoffs, the primary reason is excessive team building, only to realize the need to build a leaner company to work better.

Some technology industry insiders and analysts said that the current industry is facing two major challenges, on the one hand, to adapt to the crazy labor expansion during the epidemic, and on the other hand, to actively enter the field of artificial intelligence.
Mark Zuckerberg said the company was still adjusting to the "post-pandemic" era.

According to Meta's revenue report for the fourth fiscal quarter of fiscal year 2023 ending December 31, 2023, Meta's revenue for the full year of 2023 was $134.902 billion, an increase of 16%. Net profit rose 69% year-on-year to $39.098 billion; Revenue for the fourth quarter was $40.111 billion, up 25% from the same period last year. Advertising revenue from social media platforms was a major component of Meta's revenue in the fourth quarter, accounting for more than 96 percent of total revenue.
Meta paid a cash dividend and shares surged 20% to an all-time high. Mark Zuckerberg's net worth has increased to a staggering $28 billion. According to the Billionaires Index, Zuckerberg is worth more than $140 billion.

In the post-pandemic period, the growth in e-commerce sales that fueled the surge in online advertising began to slow, and advertising costs returned to normal levels. Many companies, including Meta, realized they had "overhired" and had to cut back drastically.
Meta layoffs in addition to the impact of the environment, on the other hand can reduce costs and streamline processes, last year, Zuckerberg mentioned the idea of Meta layoffs, and also Meta's view of the year of efficiency, which mentioned, "Since we cut staff last year, one of the surprising results is that many things go faster." In retrospect, I underestimated the indirect costs of low-priority projects."

Meta boosts investment in artificial intelligence and assists with internal office efficiency, including coding proficiency. Recently, for example, Google was leaked that it quietly launched an internal AI large language model called "Goose" to help employees write code faster, assist in the development of new products, and improve work efficiency. For use only by Google employees, an internal document notes that Goose is part of a plan to "bring AI to every stage of the product development process."

It is worth mentioning that Meta investors seem not to be willing to pay for the "meta-universe" project. For the uncertainty in this unknown field, the supervision on the expansion and development of Meta will be increasingly tightened.

It is reported that Meta is investing in artificial intelligence and related hardware for its meta-universe business, in the future of artificial intelligence and meta-universe is a two-hand, the current investment in artificial intelligence and other aspects of Meta is equivalent to paving the way for meta-universe business. However, Metaverse continues to lose money for Meta, with regulatory filings showing that since 2019, Meta's Reality Labs division, which focuses on developing virtual reality (VR), augmented reality (AR) and metaverse technologies, has lost $47 billion. For the full year 2023, the division's total loss reached $16.122 billion, up from $13.717 billion the previous year. As the division's business continues to expand, losses are expected to "increase significantly" year by year.
For Meta, whether it is around artificial intelligence or meta-universe, it is still a long-term vision, and enterprises need to reduce staff and control costs in order to better invest.