What happened
Shares of Meta Platforms (META 2.19%) climbed 21.2% in March, according to data provided by S&P Global Market Intelligence. The surge in the social media company’s shares brings their total year-to-date gain to close to 70%.
So what
Investors are feeling optimistic over Meta Platforms’ recent announcement of further layoffs. This round of job cuts — the second in just four months — involves another 10,000 workers and will take place over several months, though CEO Mark Zuckerberg has emphasized that some of the cuts could take place up until the end of this year.
With 11,000 roles made redundant in the first round and another approximately 10,000 to be shed in this latest round, Meta Platforms will see its staff strength reduced by around 25% from 87,314 in September of last year to around 66,000.
Zuckerberg seems serious about making 2023 the “Year of Efficiency” as the social media company slashes a quarter of its workforce to reduce its fixed cost base. Investors are cheering the move as it could mean the company could restart growth come 2024 while eliminating unnecessary roles and becoming a leaner outfit.
Meta Platforms is also working on beefing up its authentication service to protect its customers against rampant online impersonation. It recently introduced a paid subscription service for Facebook and Instagram that awards a badge for user verification. This badge will help with authentication and foil impersonators’ attempts to scam the company’s customers.
Now what
As Meta Platforms becomes leaner, it is also pumping more money into generative artificial intelligence (AI), the same technology that powers the now-famous ChatGPT software. Rather than use it for search engines and smart queries, the company is tapping into this up-and-coming area of AI to create personalized ads for different audiences.
These tools will enable its customers to rely on text alone to design different images for different segments of its audience rather than having to learn programming or graphic design. This move will go a long way in making Meta Platforms more attractive as a platform for advertisers, and it should happen by the end of this year.