Meta is laying off several hundred employees across multiple teams.
Reports indicate that several hundred employees across multiple divisions – including Reality Labs – have been affected, following earlier layoffs this year that reportedly impacted over 1,000 positions.
The layoffs reportedly also affect Facebook product teams, recruiting, sales, and global operations – spanning both the company’s social media core and its technology-heavy initiatives.
While Meta has not disclosed exact figures, sources suggest roughly 700 employees may be impacted in this latest round.
A Meta spokesperson described the move as part of ongoing restructuring – “Teams across Meta regularly restructure or implement changes to ensure they’re in the best position to achieve their goals. Where possible, we are finding other opportunities for employees whose positions may be impacted.”
From VR Hype to AI Focus
Meta’s leadership has been quietly reshaping the company, pivoting away from the costly “metaverse” experiments that were meant to redefine the company beyond social media.
The Reality Labs division – responsible for Quest VR headsets and Horizon Worlds virtual social platforms – has been central to both investment and scrutiny.
Earlier this year, Reality Labs reportedly cut more than 1,000 positions – and today, several hundred more jobs across multiple divisions are affected.
Since its rebranding from Facebook to Meta, Reality Labs has lost over $70 billion, with ambitious VR and metaverse bets failing to produce the expected returns.
Meta’s current approach reflects a shift in focus towards AI with aggressive spending to catch up to competitors like OpenAI, Google, and Anthropic.
This year alone, projected AI infrastructure spending is estimated to exceed $100 billion, covering data centers, AI labs, and recruitment of top AI talent.
Lessons From VR and Metaverse Bets
The repeated reductions in Reality Labs underscore the difficulty of turning ambitious VR concepts into commercially viable products.
The division has struggled with both Quest headset sales and Horizon Worlds’ user growth, leaving investors questioning the returns on Meta’s multibillion-dollar metaverse gamble.
Despite the setbacks, Reality Labs remains part of Meta’s strategic plan, focusing now on wearables and augmented reality products that integrate AI.
However, the layoffs signal a move away from broad experimentation toward a more disciplined, targeted approach.
Executive Rewards Amid Workforce Reductions
Just a day before reports of the layoffs surfaced, Meta unveiled a new executive stock incentive programme.
Top leaders – including CTO Andrew Bosworth, CFO Susan Li, COO Javier Olivan, and CPO Chris Cox – could be eligible for payouts worth hundreds of millions if the company hits ambitious performance targets.
Some estimates suggest these packages could exceed $900 million per executive under the most aggressive scenarios, though vesting depends on market capitalization and other milestones.
This contrast between executive rewards and widespread layoffs has sparked debate over optics, morale, and corporate priorities, even as shareholders view the incentives as aligning leadership with long-term company performance.
Broader Tech Industry Trends
Meta’s layoffs reflect a wider trend across tech, where firms are restructuring to focus on AI, automation, and emerging technologies.
Companies including Amazon, Atlassian, and Block have all announced reductions while simultaneously investing in AI and automation, highlighting a shift in workforce needs.
Investor reactions to Meta’s cuts have been mixed.
Share prices showed modest gains immediately after reports, reflecting confidence in the strategic pivot to AI and cost-cutting measures, though the stock remains volatile amid ongoing uncertainty over returns from Meta’s ambitious AI investments.
The Road Ahead for Meta
The latest workforce reductions as part of Meta’s ongoing transformation from a social media giant into an AI-centric organisation.
Employees must adapt to a landscape increasingly dominated by AI expertise, while the company bets its future on delivering tangible results from these investments.
The layoffs, combined with executive incentives and aggressive AI spending, signals a clear strategic focus – Meta is betting its next chapter on AI, even if that comes at the cost of scaling back other initiatives.
The tension between cost efficiency, innovation, and talent retention will continue to define the company’s trajectory in 2026 and beyond.
