JPMorgan says Meta could save $6B with 20% headcount reduction

JPMorgan keeps an Overweight rating on Meta Platforms (META) with an $825 price target after Reuters reported the company is planning to reduce its headcount by 20% or more to offset AI infrastructure costs and prepare for greater efficiency as a result of AI. JPMorgan estimates that a 20% headcount reduction could result in cost savings of $5B-$6B. However, $6B in savings “doesn’t make as big of a dent” in Meta’s $162B- $169B total expense base projected for this year, the analyst tells investors in a research note. However, such savings would result in $2.00 of incremental GAAP earnings per share above JPMorgan’s current $31.50 fiscal 2027 projection, the firm adds.