What’s next for Meta after Sheryl Sandberg’s departure?

The news: Sheryl Sandberg is leaving her chief operating officer post at Meta, after a storied career at the social media giant.

• Sandberg, CEO Mark Zuckerberg's long-standing second-in-command who had been one of the company's most visible executives, has appeared to be demoted to fewer public-facing roles in the previous year.
• Sandberg will step down in the autumn after spending the next two months transitioning her direct reports with founder Zuckerberg.

Consolidation of power: Zuckerberg has repeatedly been summoned to appear before Congress since 2018 to discuss misinformation and other issues, thrusting the formerly introverted, antisocial CEO into the spotlight instead of Sandberg.

• Those experiences in recent years may have given Zuckerberg, who was 23 when he began working with Sandberg, the confidence to take full ownership of more decision-making.
• Javier Olivan, the current chief growth officer and one of Meta's most influential but lesser-known executives, will take over as COO in a "more typical" COO job, according to Zuckerberg.
• Meta's legal chief Jennifer Newstead and head of people Lori Goler will now report directly to Zuckerberg, further strengthening his grip on the company.

Unease: Sandberg's departure, announced on Wednesday, is likely to add to the anxiety many employees feel after a turbulent year.

• According to more than a dozen interviews Fortune has conducted with employees who left since the company rebranded itself as Meta last October, the social media giant’s struggles have left many Meta employees feeling uneasy and disoriented.
• The company has been challenged to maintain revenue growth in the face of Apple's privacy changes, which it has called anti-competitive. TikTok has been eating into Meta’s advertising business as well.
• Facebook will lose users in the US for the first time.
• The company’s rapid pivot to the metaverse—not to mention its recent job freezes in that area—have reportedly unsettled some of the rank and file.

Ad problems: Olivan has some major challenges to address as he inherits the COO mantle.

• Snapchat, TikTok, and Pinterest ads are all considerably cheaper on a CPM basis, per Tinuiti.
• Internet users spend considerably less time on Facebook and Instagram than they do on TikTok and YouTube, per our forecast—which makes it harder for Meta to lower CPMs to attract more ad dollars.
• iOS changes have demonstrably led to a decline in ad spending on Meta’s mobile properties, also according to Tinuiti.

What’s next: When you think about the metaverse, our leader there is Boz [Andrew Bosworth],” Sandberg told The Verge. “He is very business-minded and I think will do a great job building the next business for the company.”

• One has to wonder why Sandberg wasn’t deemed the right person to build Meta’s metaverse ad strategy.
• The parent of Facebook, Instagram, and WhatsApp is betting heavily on its Reality Labs division, which now includes over 17,000 people, per The Verge. That’s 21% of the company’s headcount accounting for less than 3% of revenue.
• Meta's success in the metaverse will lie “not in being a trend-setter, but in how it responds when that trend starts to spin out of control,” says principal analyst Debra Aho Williamson. “Which, inevitably, it will.”

The big takeaway: Mark Zuckerberg is more powerful than ever.

• His chief lieutenants, including Bosworth, Olivan, and recently elevated president for global affairs, Nick Clegg, have their work cut out for them.