Major Meta shareholders are said to be apoplectic with CEO Mark Zuckerberg as he continued to pour billions into the flagging metaverse project.
During the company’s earnings report last month, the company announced that its Reality Labs division — the arm responsible for building the metaverse, — lost more than AU$14 billion. It also announced that the division would “grow significantly” in the coming year.
The company’s poor earnings led shareholders to vent their frustration with Meta execs in post-earnings meetings.
One source familiar with the talks said there was a palpable “sense of frustration” over Meta’s rampant spending.
“If any other company had done this, you’d have activist investors writing letters, proposing alternative slates of directors, demanding change,” Jim Tierney, chief investment officer for US growth at AllianceBernstein and a Meta shareholder, told the FT.
“I think Mark heard crystal clear what investors wanted. He’s made his decision,” Tierney added.
Zuck personally attended some of the tense meetings but none of the company’s big wigs managed to calm investors nerves during the talks.
“When people had callbacks with the company, they got more disgusted, not less disgusted,” Tierney added.
“They’re spending $15 billion a year on the metaverse and they can’t give us any mile-markers. It’s just a big hope.”
A Meta spokesperson told the FT that the company values “the opinions of our investors and regularly engage with them to ensure we’re aware of their respective perspectives.”
Zuckerberg, aside from being the Meta CEO, has some skin in the game. He earns 54 per cent of the company’s voting class shares. In effect, this means he can direct the company without significant resistance from shareholders — even if it means flushing everyone’s money down the toilet.
Prior to the earnings report, shareholders were already feeling tetchy with Meta and Zuckerberg. Investor Brad Gerstner wrote an open letter to both calling for redundancies and drastically reducing spending on the metaverse.