Meta Pivots Hard to AI, Slashes 10% of Reality Labs Workforce

Menlo Park, CA — Meta Platforms is initiating a significant workforce reduction within its hardware and metaverse division, Reality Labs, cutting approximately 10% of the unit’s staff as the company aggressively reallocates resources toward artificial intelligence.

According to a report by GeekWire, the cuts are expected to impact roughly 1,500 employees. The Reality Labs division, which produces the Quest VR headsets and manages the Horizon Worlds platform, currently employs about 15,000 workers.

Key Facts

• 1,500 Jobs Impacted: The 10% cut targets the Reality Labs division specifically, not the broader family of apps (Instagram, WhatsApp).
• Seattle Hit Hard: The division has a major engineering hub in the Seattle region, which is expected to bear a significant portion of the cuts.
• Strategic Shift: Resources are being moved from virtual reality hardware development to “next-generation artificial intelligence” and AI-powered wearables.
• Source: GeekWire, Bloomberg

The AI Pivot Accelerates

This move marks a definitive shift in Mark Zuckerberg’s strategy. For years, the company poured billions into the “metaverse”—a virtual reality ecosystem that has struggled to gain mainstream consumer traction. Now, the priority is clear: Artificial Intelligence.

Internal sources indicate the layoffs are designed to streamline Reality Labs expenses to fund the immense capital requirements of training and deploying advanced AI models. While Meta is not abandoning VR entirely, the company is slowing its investment in pure virtual reality to focus on AI glasses and smart wearables that integrate Llama-based assistants.

Reality Labs Struggles

The division has historically been a financial drain on Meta, losing billions annually as it subsidized hardware sales to build a user base. With investors demanding efficiency and the tech industry racing to dominate generative AI, patience for the long-term metaverse bet appears to have thinned.

Impact on Engineering Hubs

The cuts will significantly affect the Pacific Northwest tech corridor. Reality Labs maintains a massive presence in Redmond and Seattle, Washington—areas that have already faced contraction from Microsoft and Amazon in recent months. Employees in hardware engineering, research, and program management are expected to be most affected.