Meta are laying off about 700 people at Facebook and their VR division reality Labs, according to a March 25 report from CNBC. The layoffs come as Meta seek to pivot away from their metaverse bet and lean more heavily into AI.
Less than 24 hours earlier, the company unveiled a new stock program for six top executives that could increase compensation for some of them by as much as $921 million each over the next five years. Meta explained the move was a way to retain their senior talent in the AI era and push them toward ambitious growth.
The hundreds of new layoffs come after Meta cut about 1,500 workers in January, mostly from Reality Labs, which make the Quest VR headset and the Horizon Worlds platform. Meta employ about 78,000 people in total.
“Teams across Meta regularly restructure or implement changes to ensure they’re in the best position to achieve their goals”, a Meta spokesperson told Gizmodo in a statement Wednesday. “Where possible, we are finding other opportunities for employees whose positions may be impacted”.
Facebook were renamed Meta in 2021 because CEO Mark Zuckerberg thought the metaverse was the future. But it turns out that the need to strap a gigantic computer to your face is quite a tall hurdle for mass adoption. Meta’s Ray-Ban glasses, while a different product and use case, have sold much better, perhaps because they look like normal glasses on your face.
Reality Labs have burned through roughly $73 billion since Zuck shifted his company’s focus to the metaverse. Last week Meta announced they were shutting down Horizon Worlds only to backtrack just a couple of days later.
Meta are trying to make a larger push into AI, with a March 25 report from the The New York Times suggesting Zuckerberg (left) was even creating a "superintelligence", or a god-like AI that can act as the ultimate personal companion.
And if you must know, Meta suffered two legal defeats in the past two days, the first in New Mexico where the state Attorney General had brought a suit alleging they had misled consumers about the safety of their products and the potential harm to children.
Meta have been ordered to pay roughly $375 million in civil penalties in that case, far less than the $2 billion the state had asked for.
The second loss in court happened Wednesday when Meta and Google both lost a case brought by a woman who said she’d become addicted to Instagram and YouTube as a child and had suffered mental health issues as a result. Meta argued that the woman’s mental illnesses predated her exposure to Instagram.
The jury awarded the woman $3 million in that case.
The two cases had been closely watched because there are about 2,000 other cases against Meta pending in federal court around the issues of child safety and social media addiction.
What's more, it’s entirely possible that more layoffs at Meta are just over the horizon. Reuters reported last week that Meta would lay off 20% or more of their workforce. That would be somewhere in the neighborhood of about 15,000 people.
The reason for the layoffs, according to Reuters, was an attempt to offset “costly artificial intelligence infrastructure bets” and to “prepare” for “greater efficiency” that’s supposed to be realized by AI advancements.
Meta told Gizmodo over email Wednesday that the Reuters report was “speculative” and had “theoretical approaches”, whatever that means.