Employees were notified by Meta, the parent company of Facebook, that up to 1,500 roles in its Reality Labs division may be eliminated.
According to Bloomberg, this round of big tech layoffs corresponds to about 10% of the Reality Labs staff. The New York Times reported that the cuts were announced a day earlier, and Meta confirmed the information to Fast Company on Tuesday.
Reality Labs is the division of Meta that creates products for augmented reality (AR) and virtual reality (VR). It also managed Meta’s unsuccessful metaverse project, a virtual reality universe.
Why Meta is cutting jobs at Reality Labs
Although Meta is not certain of the precise number, published sources indicate that it intends to eliminate approximately 10% of its Reality Labs staff. With more than 15,000 workers at Reality Labs, 10% would be equivalent to around 1,500 jobs.
Andrew Bosworth, the CTO of Meta, wrote in an internal memo obtained by Bloomberg that the cuts would amount to roughly 10%.
A Meta representative said, “We said last month that we were shifting some of our investment from the metaverse toward wearables. This is part of that effort, and we plan to reinvest the savings to support the growth of wearables this year.”
But why are there so many cuts? Bosworth informed staff members that Meta is shifting its focus from virtual and augmented reality toward mobile experiences rather than VR hardware.
He also stated that Meta is cutting back on VR spending in order to make the company “more sustainable.”
The strategy is “to reinvest the savings [from the Reality Labs cuts] to support the growth of wearables this year,” according to a spokesperson.
Why the metaverse never took off
The metaverse never truly took off as Meta had hoped. Because of this, it is not surprising that the company is now focusing more on mobile and artificial intelligence than on its virtual-world projects.
In 2021, CEO Mark Zuckerberg declared that the company, then known as Facebook, was heading toward virtual worlds, calling them the “next frontier” of technology.
He formally unveiled the metaverse in October of that year and changed the company’s name from Facebook to Meta, as he was confident about VR’s future.
However, most people did not adopt virtual reality widely after more than four years of investment. Interest remained relatively limited. When ChatGPT debuted in 2022, it became clear that AI would be the next major technological focus.
Since then, Meta’s metaverse products have fallen behind as the industry has fully embraced AI.
Shares of Meta Platforms (Nasdaq: META) dropped more than 2% in midday trading on Tuesday following the announcement.
As artificial intelligence advances, tech workers face more uncertainty
The layoffs at Reality Labs, the Meta division focused on virtual and augmented reality, represent the largest round of job cuts by a major tech company so far this year.
Workers in the tech industry, particularly those not involved in AI development, may wonder whether their employers might follow this example by eliminating positions in more traditional, non-AI-focused fields while increasing investment in AI initiatives.
Tech companies eliminated approximately 124,000 jobs in 2025 across 269 companies, according to Layoffs.fyi.
Although that is a significant number, the website reports that overall tech layoffs have been declining since 2022. Layoffs rose from more than 165,000 in 2022 to nearly 265,000 in 2023 before falling to about 152,000 in 2024.
Although AI emerged in 2022 with the promise of reducing labor time, there is still a long way to go. Even though Nobel Prize winner Giorgio Parisi agrees with Elon Musk and Bill Gates that AI could make work as we know it disappear, humans are still needed to properly train AI so that it can carry out these roles.
This post originally appeared on fastcompany.com.
