META To Cut 8,000 Workers To Offset Heavy AI Spending: Report

• Layoffs to affect 10% of its workforce, effective May 20, 2026.
• Meta on hiring freeze for 6,000 open roles.
• Move made in an effort to boost efficiency and offset heavy AI spending.

Meta Platforms (META) stock dropped 3% after announcing plans to lay off 8,000 employees or 10% of its workforce in a bid to offset heavy AI spending. 

The company disclosed the move in a memo sent to employees on Thursday, stating that the layoffs will take effect on May 20. Meta also won’t hire workers for 6,000 open roles that it had intended to fill, according to Bloomberg.

“We’re doing this as part of our continued effort to run the company more efficiently and to allow us to offset the other investments we’re making,” wrote Janelle Gale, Meta’s chief people officer, in a note to employees, which was reviewed by Bloomberg.

Meta earlier this year cut 10% workforce from its Reality Lab division (roughly 1,500 employees), signaling a cooling of Mark Zuckerberg's aggressive metaverse spending in favor of AI-driven wearables. 

This comes on the back of heavy layoffs and other cost-cutting measures that big tech firms are adopting to fund higher AI spending. Microsoft (MSFT) also reportedly offered voluntary retirement to thousands of US employees on Thursday.

Oracle, Amazon, Atlassian, eBay, Autodesk, and Workday are a few of the other big tech companies who announced layoffs since the beginning of this year. 

Retail Investor View 

Retail sentiment on Stocktwits was ‘bearish’ with ‘normal’ message volumes. 

One user thinks that while AI spending sounds interesting, it won’t bring significant ROI. 

Another user highlighted that the layoffs could mean weaker-than-expected earnings. 

The stock lost 0.3% year-to-date. 

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