This article first appeared on GuruFocus.
Meta Platforms Inc. (META, Financials) plans to lay off 10% of Reality Labs workers, which develops metaverse and virtual reality products, according to the New York Times.
The 15,000 person division is where Mark Zuckerberg is putting his long-term bet on virtual and augmented reality. Teams that make virtual social platforms and VR headsets like the Quest line could lose their jobs as soon as Tuesday.
Since 2020, Reality Labs has spent around $60 billion trying to turn Meta’s vision of a digital world into a profitable business. The Ray-Ban smart glasses partnership has been good for the brand, but demand for immersive digital environments has been slow to pick up.
Andrew Bosworth, the Chief Technology Officer in charge of the division, is said to have asked workers to meet in person this week to talk about the restructure. Meta did not respond to the report.
Meta is having a hard time keeping up with OpenAI and Google in the field of artificial intelligence. People were worried about Meta’s AI and VR plans when the Llama 4 model didn’t do well.
Investors might interpret the layoffs as a sign that Meta is still cutting costs in areas with slower growth and putting more focus on AI infrastructure and advertising efficiency, which are what make the company money.
