BofA sees room for additional efficiencies at Meta

BofA analyst Justin Post notes that Financial Times reported that Meta Platforms might be preparing for another round of layoffs with the company going through performance reviews and internally lacking clarity about budgets or future headcount. While the article was "light on the potential size of any layoffs," the firm sees room for additional efficiencies, noting that the company was operating with 58,000 employees just two years ago, compared to roughly 76,000 estimated today. Among major online media platforms, BofA estimates Meta has the highest operating expense per employee and even though the firm notes that Metaverse spending may be inflating opex by up to 25%, it believes there is scope to further reduce Meta’s cost structure. BofA maintains a Buy rating and $220 price target on Meta shares.