Meta is set to lay off hundreds of employees at its Reality Labs division this week, affecting around 10% of the team responsible for metaverse projects, The New York Times reported. Reality Labs, which employs roughly 15,000 people, develops the company’s virtual and augmented reality products.
The layoffs reflect Meta’s strategic pivot toward artificial intelligence, which the company has prioritized over virtual reality development. Bloomberg reported that Meta plans to reduce its metaverse budget by approximately 30%, even as products like Ray-Ban Meta smart glasses gain attention. VR social platforms, however, continue to see limited consumer engagement, contributing to over $70 billion in losses for Reality Labs since 2021.
Meta’s CTO, Andrew Bosworth, urged employees to attend an in-person meeting he described as “the most important of the year” to discuss the changes. The shift aligns with Meta’s broader AI strategy, including its new Meta Compute initiative, aimed at expanding AI infrastructure, energy capacity, and global data center capabilities to support long-term AI development.
