Meta has announced it will lay off 11,000 employees or around 13 percent of the company’s total staff. CEO Mark Zuckerberg announced the news in a blog post, saying he was at fault for being overoptimistic about the company’s future growth based on a pandemic surge.

“At the start of Covid, the world rapidly moved online and the surge of e-commerce led to outsized revenue growth,” said Zuckerberg. “Many people predicted this would be a permanent acceleration that would continue even after the pandemic ended. I did too, so I made the decision to significantly increase our investments. Unfortunately, this did not play out the way I expected.”

Zuckerberg said the company would now become “leaner and more efficient” by cutting spending and staff, and shift more resources to “a smaller number of high priority growth areas,” including ads, AI, and the metaverse. Zuckerberg said that the company’s recruiting team would be particularly “disproportionately affected” by the cuts. Meta reported some 87,000 employees in September, with today’s layoffs making the first broad cuts since the firm’s founding in 2004.

Why has Meta been hit so hard? Well, a projected downturn in the US economy has blunted momentum for many tech stocks, but the company’s prospects have also been affected by both strong competition from rivals and wayward strategy.

The rise of TikTok and changes to Apple’s privacy policy have squeezed Meta’s fantastically lucrative ad business, while the company’s investments in the nascent metaverse look increasingly misguided. Meta has lost $9.4 billion on its metaverse technology in 2022 so far and says it expects to spend even more on the business in the future. Meanwhile, the company’s flagship metaverse social platform, Horizon Worlds, is so buggy and unpopular that Meta’s own managers have been forced to shame employees into using it.

As the bad news has piled up, Meta’s stock has cratered. Its stock price has dropped more than 70 percent this year, and it’s lost $700 billion in market value in recent weeks. However, following Zuckerberg’s announcement of job cuts, the company’s stock price rose more than four percent in pre-market trading.

Meta is not the only tech firm reporting broad layoffs, though. Salesforce this week confirmed it’s laid off hundreds of employees; Snap said in August it planned to cut 20 percent of its workforce; and Twitter has laid off thousands of employees under the management of new owner Elon Musk.

In the blog post announcing Meta’s cuts, Zuckeberg said laid off employees in the US would receive 16 weeks of base pay plus two additional weeks for each year of service, health insurance coverage for six months, and support for finding a new career and navigating immigration issues. Zuckerberg said the company would be instituting a hiring freeze through the first quarter of 2023 “with a small number of exceptions.”

The Meta CEO finished his note to employees with a message seemingly aimed at outside observers, including those skeptical of the company’s push into the metaverse.

“I believe we are deeply underestimated as a company today,” wrote Zuckerberg. “Billions of people use our services to connect, and our communities keep growing. Our core business is among the most profitable ever built with huge potential ahead. And we’re leading in developing the technology to define the future of social connection and the next computing platform.”