Altimeter Capital have written an open letter to Mark Zuckerberg suggesting that he may be getting in too deep on the metaverse and hurting Meta’s profitability. Zuckerberg’s legless avatar could not immediately be reached for comment, as no one has bought the silly goggles you need to put on to find him.

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Open letter from Altimeter to Meta

As we mentioned on Friday, investors are pressuring companies to outline a path to profitability. Companies that are already profitable are now being asked to squeeze more free cash flow from their operations.

Founder and CEO of Altimeter Capital, Brad Gerstner, penned an open letter to Mark Zuckerberg asking the Meta CEO to do just that. The letter contains three principal requests:

• Reduce headcount expense by at least 20%

• Reduce annual capex by at least $5 billion

• Limit investment in the metaverse to no more than $5 billion per year

This will supposedly lead to a doubling of free cash flow and an increased share price, which has been suffering of late.

The letter is most interesting for the pessimism it directs at Meta’s change in strategy. It suggests the pivot to the metaverse was only undertaken as the core business was about to hit a wall and wants investment in this area of the business to be capped at $5 billion per annum. All in all, it’s the second worst telling- off Zuckerberg has received. Here’s number one.

The content we're consuming today

• The FT: Glitz and Gladwell: The infighting over prized JPMorgan wealth clients ($).

• Reuters: Logitech’s quarterly sales down 12%, CFO to depart.

Off-balance sheet items

• The book, Ready Player One, by Ernest Cline, is a cautionary tale of a future where humanity spends most of its time in a virtual world.

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