Key Takeaways
- Meta plans to cut 1,500 jobs (10% of staff) from its Reality Labs division.
- CTO Andrew Bosworth has called the “most important” all-hands meeting for the unit.
- The layoffs signal a major strategic shift towards AI, away from the metaverse.
- Meta announced a massive new AI compute initiative, “Meta Compute,” on the same day.
Meta is reportedly preparing to lay off around 1,500 employees from its Reality Labs division, a move signalling a sharp strategic pivot towards artificial intelligence. The cuts, expected to be announced imminently, would affect roughly 10% of the unit’s 15,000-strong workforce.
Adding to the internal tension, Meta’s Chief Technology Officer Andrew Bosworth has scheduled a critical all-hands meeting for Reality Labs staff, described as the “most important” of the year. Employees have been asked to attend in person, a day after the expected layoff announcement.
Reality Labs: From Metaverse Flagship to Cost-Cutting Target
Reality Labs is the division behind Meta’s virtual and augmented reality products, including VR headsets, Ray-Ban smart glasses, and the Horizon Worlds platform. It originated as Oculus, a startup acquired by Facebook in 2014, and became the centrepiece of the company’s metaverse vision.
Concerns over the unit’s future have grown for months. Last month, reports indicated a planned 30% budget reduction for Reality Labs, highlighting a clear reallocation of company resources.
Meta’s AI Ambitions Take Centre Stage
The layoff news coincides with Meta’s aggressive push into artificial intelligence infrastructure. The company announced “Meta Compute,” an initiative to build “tens of gigawatts” of AI computing capacity by 2030. This scale of data centre power is comparable to that used by multiple large cities.
On the same day, Meta appointed Dina Powell McCormick, a former presidential adviser and banking executive, as president and vice chairperson. Her role will focus on policy, government relations, and partnerships to support these large-scale infrastructure projects.
CEO Mark Zuckerberg framed the AI infrastructure investment as a future strategic advantage, stating: “How we engineer, invest, and partner to build this infrastructure will become a strategic advantage.” He used similar rationale in 2022 to justify heavy spending on the metaverse.
An Uncertain Future for the Metaverse
For Reality Labs employees, the impending cuts confirm a significant corporate priority shift. While the metaverse effort isn’t ending, AI has clearly taken centre stage, leaving the once-flagship division facing a more uncertain path forward.
