Meta To Reportedly Slash 10% Of Reality Labs Employees, Shifting Focus From Metaverse To Next-Gen AI

• The official announcement could come as soon as Tuesday, as per the report from The New York Times. 
• Meta’s chief technology officer Andrew Bosworth, who heads the Reality Labs division, has reportedly called for a meeting on Wednesday, urging staff to attend in person, as per the report.
• Bosworth has also said that the meeting was the “most important” of the year, without giving more details, as per the report.

Meta Platforms Inc. (META) is reportedly planning to lay off about 10% of its workers in the Reality Labs business, including those working on metaverse.

The potential cuts comes as the tech giant shifts its focus to next-generation artificial intelligence, as per a report from The New York Times which cited three people familiar with the matter.

Reality Labs employs about 15,000 people, a small fraction of Meta’s total 78,000 workforce, but the layoffs would disproportionately affect people in the metaverse unit, working on virtual reality headsets and a virtual reality-based social network, according to the report.

The news comes amid Meta’s announcement of a new “top-level initiative” called Meta Compute as well as the appointment of a new President and Vice Chairman, both focusing on expanding the company’s artificial intelligence infrastructure.

Shares of META were up 0.13% in Monday’s after-market trade at the time of writing. The stock was also among top trending tickers on the platform.

Strategic Pivot

The official announcement could come as soon as Tuesday, as per NYT. 
Meta’s chief technology officer Andrew Bosworth, who runs the Reality Labs division, has reportedly called for a meeting on Wednesday, urging staff to attend in person, as per a memo seen by NYT.

Bosworth also mentioned that the meeting was the “most important” of the year, without giving more details, as per the report.

An earlier report from Bloomberg said the company was planning budget cuts as high as 30% for its metaverse division in 2026, including layoffs targeting the Meta Horizon Worlds platform and the Quest VR unit. The metaverse division was touted to have been asked to take a deeper cut amid lackluster adoption of virtual worlds by consumers. Since 2021, Reality Labs has accumulated losses of over $70 billion, as per the report.

This a pivot for the company that had rebranded to Meta from Facebook as Zuckerberg chased a V.R.-based social networking vision.

According to the NYT report and earlier report from Bloomberg, Meta plans to divert funds from metaverse to bolster its efforts in artificial intelligence and associated hardware, as well as boost its wearables division, including smart glasses and wristband computing devices.

Artificial Intelligence Push

Earlier, the social media giant’s chief Zuckerberg announced that the company is establishing a new “top-level initiative” called Meta Compute to build tens of gigawatts this decade and amp this up to hundreds of gigawatts or more over time.

The company also named Dina Powell McCormick as President and Vice Chairman, to work closely on its compute and infrastructure goals. In 2025, Meta announced an investment of $600 billion in the U.S. by 2028 to build AI data centers as it plays catch-up on its AI strategy to compete with the likes of OpenAI and Google.

How Did Stocktwits Users React?

On Stocktwits, retail sentiment around META stock remained in the ‘bearish’ territory over the past 24 hours amid ‘high’ message volumes.

Shares of META have gained over 5.5% in the past year.

For updates and corrections, email newsroom[at]stocktwits[dot]com.
 

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