Less metaverse and more layoffs: A Meta investor just wrote a scathing open letter to the company telling it to get its ‘mojo back’

Since he changed Facebook’s name to Meta last year and rebranding the company to emphasize its focus on the “metaverse”—an augmented virtual reality—Zuckerberg’s personal net worth has dropped by over $70 billion, and as of Monday, Meta’s share prices are down over 60% year to date. 

Investors aren’t happy. And one went so far as to write an open letter to the company with suggestions on how it could get its “mojo back.” Altimeter Capital chair and CEO Brad Gerstner, whose investment firm owns 2.5 million shares of Meta, said the company has lost its focus. 

“Meta has drifted into the land of excess—too many people, too many ideas, too little urgency. This lack of focus and fitness is obscured when growth is easy but deadly when growth slows and technology changes,” Gerstner wrote.

He went on to say that the company has lost the confidence of investors—and a lot of that has to do with Zuckerberg’s obsession with the metaverse.

“The conventional wisdom—press and investor—is that the core business hit a wall last fall,” Gerstner said. “As a result, the team hastily pivoted the company toward the metaverse—including a surprise re-naming of the company to Meta. Worse, this skepticism seemed to be affirmed with a nearly-immediate and sizable miss in financial results and continued under-performance throughout 2022.”

In July of this year, Meta reported a 1% decline in its second quarter revenue compared to the same period last year—its first ever decline in revenue since going public. Despite Meta attributing the setback to tough macroeconomic conditions, Gerstner said, “the decline in share price mirrors the lost confidence in the company, not just the bad mood of the market.”

So he’s proposing a three-step plan to double the company’s free cash flow to $40 billion per year.

First, reduce headcount expenses by at least 20%. Gerstner said he doesn’t take the job reductions “lightly” and that “they’re not just numbers on a spreadsheet.”

Meta is reportedly already mulling layoffs that could affect 15% of its workforce. 

Next, Gerstner suggests the company should reduce its annual capex, its annual capital expenditures used to acquire, upgrade, and maintain physical assets, by at least $5 billion. He said those numbers reached around $30 billion in 2022. 

“Meta is investing more in capex than Apple, Tesla, Twitter, Snap, and Uber combined!” he wrote. He added, however, that the company should continue its investment in A.I. (artificial intelligence) to make all of its existing products better. 

Gerstner’s last suggestion: Limit investment in the metaverse to less than $5 billion per year. 

“People are confused by what the metaverse even means,” he said. “If the company were investing $1–2B per year into this project, then that confusion might not even be a problem.”

But he pointed out that the company has announced that it’s investing much more than that into its metaverse project, and has openly said it could take up to 10 to 15 years to see results. 

“An estimated $100B+ investment in an unknown future is super-sized and terrifying, even by Silicon Valley standards,” Gerstner wrote. 

He ended by saying he  supports the company’s interest in the metaverse, but stressed that it can no longer be so “ambitious” and “open-ended” in its investments.

“We think the recommendations outlined above will lead to a leaner, more productive, and more focused company—a company that regains its confidence and momentum,” he said.

Meta did not immediately respond to Fortune’s request for comment. 

Sign up for the Fortune Features email list so you don’t miss our biggest features, exclusive interviews, and investigations.