Meta is preparing to cut 10-15% of its Reality Labs workforce, the division responsible for metaverse development, as the company pivots sharply towards artificial intelligence (AI). The cuts, which could be announced as early as Tuesday, reflect a strategic realignment under CEO Mark Zuckerberg, who has directed executives to aggressively fund AI research while scaling back investment in virtual reality (VR).
Metaverse Vision Takes a Backseat
The layoffs will disproportionately impact the approximately 15,000 employees in Reality Labs, including those working on VR headsets and the company’s metaverse-based social network. While a relatively small fraction of Meta’s 78,000 total employees, the cuts signal a significant de-prioritization of Zuckerberg’s long-held vision for a VR-driven future of social networking.
This move represents a major shift in Meta’s strategy, acknowledging the current limitations and financial strain of the metaverse while doubling down on the rapidly evolving AI landscape.
AI Investment Surge
Zuckerberg has reportedly ordered budget cuts across the company, specifically reallocating funds from VR projects to Meta’s AI initiatives. This includes a substantial increase in funding for TBD Lab, Meta’s secretive unit dedicated to developing “superintelligence” AI systems. The company also plans to inject more resources into its wearables division, which develops smart glasses and wrist-worn computing devices.
Bosworth Meeting Signals Change
Andrew Bosworth, Meta’s chief technology officer and head of Reality Labs, has scheduled an in-person meeting for Wednesday, described by internal memos as the “most important” of the year. This timing suggests the layoffs will be a central topic of discussion.
Why This Matters
Meta’s decision underscores a growing industry skepticism towards the metaverse’s immediate profitability. The company invested billions in VR since acquiring Oculus in 2014, and even rebranded itself as “Meta” in 2021 to emphasize its commitment to the immersive digital world. Now, faced with intensifying competition from OpenAI and Google in the AI race, Zuckerberg is making a calculated gamble: abandoning the metaverse dream in favor of a potentially more lucrative AI future. The move raises questions about the long-term viability of VR and the broader metaverse concept, while solidifying AI as the dominant tech battleground.
The layoffs are not merely cost-cutting measures but a strategic realignment that could reshape Meta’s trajectory for years to come.
