Meta (META) could be bracing for a "tornado-like quarter," says Wedbush Managing Director Dan Ives.
The social media giant, like other tech companies, is scaling back hiring plans as it braces for an economic downturn. This week Meta's founder and CEO Mark Zuckerberg said the company would cut back its hiring target for this year by at least 30%.
"If I had to bet, I'd say that this might be one of the worst downturns that we've seen in recent history," Zuckerberg told employees during a weekly Q&A session which was recorded and heard by Reuters.
Meta's revenue growth slowed after Apple (AAPL) implemented privacy changes to its operating platform which makes it more difficult for advertisers to target users.
"Because of the Apple IOS privacy issue — that's been the been the gut punch, that continues to be a cut every quarter," said Ives.
"There's some pain ahead there," said the analyst, noting the social media giant's pivot towards developing the metaverse, or next generation of the Internet.
"You can rename the company Meta —[but] metaverse is still not until 3-5 years out in terms of revenue perspective. I think this is really bracing for a tornado-like quarter."
Meta stock is down more than 50% year-to-date.
Ines is a markets reporter covering equities. Follow her on Twitter at @ines_ferre