Meta Plans Major Layoffs in Reality Labs Division
Meta is gearing up to lay off approximately 1,500 employees from its Reality Lab division, which represents around 10% of the 15,000 strong workforce. This action may happen as early as this week, signifying a significant pivot towards artificial intelligence.
The layoffs are expected to affect teams involved in virtual reality headsets and the company’s VR-based social network. This comes in spite of the fact that executives are investing billions into AI research, new data centers, and the development of smart glasses, according to reports from various sources.
Andrew Bosworth, a prominent figure at Meta, has called an all-hands meeting, labeling it the company’s “most important” gathering of the year and strongly encouraging in-person attendance.
Reality Labs has been a financial burden for Meta, accumulating losses exceeding $70 billion since 2020 largely due to declining consumer interest in virtual reality headsets. The impending job cuts arrive as CEO Mark Zuckerberg has instructed top executives to tighten the company’s budget for 2026 while simultaneously channeling significant funds into artificial intelligence initiatives, including a project aimed at achieving what he refers to as “superintelligence.”
To support these efforts, Meta has been offering competitive compensation packages to attract leading AI researchers and engineers. The company made a considerable investment in Scale AI last year, totaling $14.3 billion, and also acquired the AI startup Manus for over $2 billion as part of its strategy shift.
Moreover, Meta is implementing changes to its employee evaluation and bonus structure, introducing a new performance program called Checkpoint. This program aims to substantially increase rewards for top performers, with high achievers potentially eligible for bonuses up to 300% of their base salary. The structure classifies employees into four performance tiers, with about 20% expected to be rated as “excellent” and receiving double the base bonus.
However, employees not meeting expectations will not receive any bonuses, and the standards are becoming increasingly stringent. These changes will kick in mid-2026, vying to cultivate a performance-driven culture in light of recent layoffs and internal calls for heightened efficiency.
The company’s timing with these changes has raised eyebrows among employees, as there are worries that pay and promotion prospects may increasingly hinge on quantifiable results. The Post has sought comments from Meta regarding these developments.
