Meta Platforms reportedly set out plans to divest business software company Kustomer which it acquired in 2022, as part of efforts to refocus on its core business.

The Wall Street Journal (WSJ) reported sources told it Meta Platforms had decided Kustomer was a non-core asset earlier this year, one which it is burning through too much cash to keep.

Kustomer software takes conversations from different channels and puts them onto a single screen: Meta Platforms moved to acquire it in 2020 in a deal which valued the business at $1 billion.

Completion was held up by regulatory scrutiny, with Meta Platforms positioning the tie-up as helping with a wider plan to enable businesses to use WhatsApp and Facebook Messenger apps for customer services.

With Meta Platforms facing-up to lower digital advertising sales and a general downturn in the technology industry, CEO Mark Zuckerberg outlined plans at the start of the year to become more efficient and cut projects which are not performing.

Kustomer arguably falls under that category: WSJ sources stated revenue has flattened and it spent $200 million on operational and one-time expenses since the deal completed.

Meta Platforms could keep hold of a small stake in Kustomer however its valuation will be significantly lower than what it paid due to the current economic environment.

Ryan Moore, a representative for Meta Platforms, told WSJ it was “exploring strategic alternatives for Kustomer”, adding it had made a decision to focus on revenue opportunities for WhatsApp.