A Meta exec warns that the company still faces challenges after the stock jump.
Meta executive warns employees they're still "at the whim of Apple" Meta had an abysmal 2022. The value of its stock fell by 65 percent year over year, it laid off 11,000 people, and [employee morale has suffered](. There are signs things are turning around, though: Earlier this month, the company reported stronger-than-expected Q4 earnings and saw [its stock price jump by more than 20 percent]( in a single day. While almost every other major tech company is continuing to struggle and has also laid off thousands from their workforces, none has seen a stock market rebound anywhere close to Metaâs. That progress could be overstated and the company isnât out of the woods just yet, according to an internal memo from one of the companyâs top executives that Recode obtained. Meta still faces major business challenges, including Apple limiting its advertising business, TikTokâs rising popularity, and its brand sentiment with users in the US. Meta declined to comment. In the note, which Meta Chief Marketing Officer Alex Schultz posted on Metaâs internal employee message board, Workplace, in early February, he cautioned employees to contain their excitement. âWe have to keep our eyes on the horizon and not focus on the reaction of the street and our stock price,â he wrote. âI believe in this company ... but weâre still early in this turnaround, not everything will pan out.â Do you work at Meta and have thoughts about whatâs going on at the company? You can send us a tip at shirin.ghaffary@protonmail.com. We can grant requests for anonymity if needed. Signal number available upon request. Schultz wrote that Meta is still âat the whim of Apple,â referencing the [new privacy feature]( that the iPhone maker introduced in 2021 that limited the amount of data Meta can collect about many mobile users, making it harder for the company to target ads â which is a key part of its business model. Last February, Meta [said the change would cost]( the company $10 billion in lost revenue a year â around as much as the company is spending annually on its metaverse ambitions. Since Apple made the change, Facebook had been using AI to recoup those losses and better target ads without Appleâs help. One approach, [according to the Wall Street Journal,]( has been âbargaining with usersâ to get them to agree to tracking in exchange for seeing fewer ads. These efforts are still early, though, and Schultzâs memo reflects the continued power that Apple, as the gatekeeper of the iPhone App Store, still holds over Facebook and Instagram. The executive also tempered expectations around [Reels, Metaâs TikTok clone](, saying that its âmonetization efficiencyâ â or how much money the company is making from ads on Reels â has grown âbut is still very low.â Overall, Reels is âstill smaller than TikTok,â Schultz wrote. [Meta CEO Mark Zuckerberg said in November]( that the amount of time users spend on Reels is about half of the time spent on TikTok, in countries outside of China. Zuckerberg also said in a post-earnings call [post this month]( that there are more than 140 billion Reels plays across Facebook and Instagram each day, a more than 50 percent increase from six months ago. But advertising within Reels still doesnât make nearly as much money as advertising within Facebook and Instagram feeds. In terms of the overall popularity of Metaâs apps, Schultz was similarly blunt. âWe are seeing better numbers on young adults and teens in the US but weâre not satisfied, sentiment trends are better for our brands but that doesnât mean they are good in the US and similar countries and I could go on and on,â Schultz wrote. The memo is in line with Zuckerbergâs drumbeat of messaging in recent months: Employees need to work harder to make sure [Meta is âwinningâ again](. The company is [reportedly planning another round of layoffs](. In particular, Zuckerberg wants [to cut layers of middle management]( as part of his drive for increased efficiency. For Meta, a company that had two decades of nearly unstoppable growth that suddenly halted in the past year, the note is also a demonstration of how tenuous the companyâs trajectory remains. Itâs too early to call Metaâs recent stock market gains a comeback. As Meta and the rest of the tech industry face unprecedented economic uncertainty, Metaâs leaders arenât planning to let the company rest on its laurels. Schultzâs note makes it clear: Thereâs still a lot more work to do before Meta can return to its glory days. Read the full memo below: Hey, team, just like when I talked in our Q&A after our stock price dropped precipitously last year thereâs been another big street reaction to our earnings call (and the run up to it), this time up. Itâs nice to see people thinking weâve improved our discipline and weâre not as bad they thought. Iâve been in a few groups though where Iâve seen folks get quite excited. So I want to remind you what I said last year. Weâre never as bad as they think we are at times like last yearâs stock crash but weâre probably never as good as they think at times like this. Weâre still early in this turnaround. We still have efficiency we need to find to run this company better in the new reality, weâre still at the whim of Apple, relative Monetization Efficiency has grown on reels but it is still very low, reels have grown a lot but they are still smaller than TikTok, we are seeing better numbers on young adults and teens in the US but weâre not satisfied, sentiment trends are better for our brands but that doesnât mean they are good in the US and similar countries and I could go on and on. We have to keep our eyes on the horizon and not focus on the reaction of the street and our stock price. I believe in this company, I am really bullish in the long term future, all the things I felt positive about last year, I feel positive about, BUT weâre still early in this turnaround, not everything will pan out, we will have a lot of highs and lows yet and we have to keep a long term focus and level head no matter what the outside noise is, positive or negative. Stay Focused and Keep Shipping âShirin Ghaffary, senior correspondent [An illustration of a single pill falling out of a pill container, as well as pieces of paper in the shape of pills.]( Dion Lee/Vox [The forgotten victims of the Adderall shortage]( [People with narcolepsy need stimulants, too. But many pharmacy shelves are empty.]( [Salma Hayek Pinault and Channing Tatum dance onstage in the movie âMagic Mikeâs Last Dance.â]( Claudette Barius/Warner Bros. 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