Meta, Facebook's parent company, is slowing recruitment as it considers its weakest revenue growth in history and continuing business challenges such as Apple's privacy changes and the war in Ukraine A meta spokesperson told CNBC in an email on Wednesday: "we regularly reassess our talent pipeline based on business needs and we are slowing its growth accordingly, taking into account the cost guidance given in the financial reporting period. However, we will continue to grow our workforce to ensure that we focus on long-term impact."
In last week's earnings report, meta predicted that revenue in the second quarter may decline year-on-year. David Wehner, the company's chief financial officer, highlighted several problems facing the company and said that this year's expenditure will be between $87 billion and $92 billion, lower than the previous forecast of $90 billion to $95 billion.
According to a person familiar with the company's plans, meta intends to stop or slow the recruitment of most intermediate and senior positions after suspending the increase of junior engineers in recent weeks. The source said that recruiters have begun to suspend recruitment for some positions.
Insider reported on these plans earlier citing a memo Wehner gave employees.
The company has struggled since last year as users abandoned its Facebook app. In February, meta said its number of daily active users fell continuously for the first time in the fourth quarter - although this number rebounded in the first quarter of 2022.
Nevertheless, due to macroeconomic concerns and the war between Russia and Ukraine, the digital media business has been widely hit.
"After the Ukrainian war, our growth further slowed down due to the loss of revenue in Russia and the reduction of advertising demand inside and outside Europe," Wehner said in last week's earnings conference call. "We believe that this war has brought further fluctuations to the already uncertain macroeconomic environment of advertisers."
Wehner reiterated to investors, Apple Privacy changes implemented on its IOS devices last year will hurt growth, after the company had predicted that the move would reduce its revenue by $10 billion this year.
On Wednesday local time, the Federal Reserve raised its benchmark interest rate by half a percentage point to cope with 40 years of high inflation. Although Facebook's share price closed up 5% that day, its share price is still down 34% this year.