Meta Platforms Should Reduce Headcount Expenses by 20%

© Stocksak. Meta Platforms (META). Should Lower Headcount Expenses By 20% – Altimeter Capital

By Sam Boughedda

Altimeter Capital Chair and CEO Brad Gerstner stated Monday in an open letter to Meta Platforms. (NASDAQ:). He said that the metaverse and social media company must regain its mojo and rebuild investor confidence through a reduction of headcount, Capex, and limiting investment in metaverse.

Gerstner suggests that Meta reduce its headcount expenses by at least 20%, lower its annual Capex from $30 billion- $25 billion billion, and limit its investment into its metaverse/Reality Labs Division to no more then $5 billion per annum.

“Meta must re-build confidence among investors, employees, and the tech community to attract, inspire, retain, and retain the best people around the world. Gerstner stated that Meta must get fit and focus. He said that Meta would return to mid-2021 levels of employee expense if the 20% reduction in employee-related costs was implemented.

Meta shares have fallen more than 62% by 2022 and more that 3% Monday. Investors are becoming increasingly concerned about its performance.

Meta’s metaverse transition has not been easy. Recently, reports claimed that it is not reaching its user goal for Horizon Worlds. The company previously stated that it is working to retain users for its VR headsets.

“While the increase in AI investment was well-timed, Meta’s metaverse investment, although smaller than the AI investment has received the most attention and has caused much confusion. Gerstner speculated that the metaverse renaming caused the world to conclude that you were spending all your time on Reality Labs and not AI or the core business. “People are confused as to what the metaverse actually means. If the company were investing $1–2B per year into this project, then that confusion might not even be a problem.”

Altimeter Capital CEO said that, while he believes Meta should be investing into the metaverse, the large amount Altimeter Capital invests in “in an undetermined future” is terrifying and out of reach.

“We think the recommendations outlined above will lead to a leaner, more productive, and more focused company — a company that regains its confidence and momentum,” he added.

News Source and Credit

Stocksak Editorial

We are a financial blog that covers topics such as investing, saving, spending, and earning more money. Please feel free to peruse our site and read any of the articles that catch your interest.

Related Articles

Leave a Reply

Your email address will not be published.

Back to top button