Meta to cut over 1,000 jobs from Reality Labs division

Meta

• Meta to lay off 10% of Reality Labs staff, impacting 1,000+ employees
• Meta lays off VR and metaverse teams to focus on AI.
• Meta's AR hardware teams will mostly avoid cuts amid strategic pivot.

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Meta is planning another round of job cuts, this time hitting its Reality Labs division, the team responsible for virtual reality, the metaverse, and experimental hardware. According to New York Times report, the company is preparing to lay off around 10 percent of employees in Reality Labs as it shifts its focus and money toward artificial intelligence.

Reality Labs employs roughly 15,000 people, meaning the cuts could affect more than a thousand workers. While this is a relatively small slice of Meta’s overall workforce of about 78,000, the impact will be felt most sharply inside the metaverse-focused unit. Teams working on virtual reality headsets and Meta’s VR-based social platforms are expected to be the hardest hit. The report said the final number could even exceed 10 percent.

The layoffs could be announced as soon as Tuesday. Adding to the tension, Meta’s chief technology officer Andrew Bosworth, who oversees Reality Labs, has called what he described as the “most important” meeting of the year for Wednesday. Employees have been urged to attend in person, though the memo did not explain what would be discussed.

At the heart of the decision is a major shift in priorities driven by CEO Mark Zuckerberg. Over the past year, Zuckerberg has pushed senior leaders to trim future budgets so Meta can pour more resources into building next-generation AI systems. The company is under growing pressure from rivals like OpenAI and Google, and Zuckerberg has made it clear that AI is now Meta’s top strategic bet.

As part of this pivot, Meta is also moving some funding away from traditional virtual reality products and toward its wearables business. This includes smart glasses and wrist-based computing devices, which combine hardware with AI-driven features. While Meta’s VR headsets have struggled to attract mass adoption despite billions of dollars in investment, its AI-powered smart glasses have fared better. The Ray-Ban smart glasses, which include a camera and a built-in AI assistant, have sold more than two million units so far.

Importantly, teams working on augmented reality hardware are expected to be largely spared from the layoffs. These groups are building glasses and wristbands that let users control digital menus using voice commands and hand gestures. Meta recently said it is delaying the international rollout of its more advanced display-equipped smart glasses due to limited supply and unexpectedly strong demand.

Meta has declined to comment on the reported layoffs. While the company insists it is not abandoning the metaverse altogether, the message is clear: the vision is being reshaped. For Meta, the future now looks far more AI-driven than virtual.