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Adding to the layoffs wave, Meta has let go of around 700 employees even as it rolled out fresh stock incentives for its top executives just hours earlier.
The timing of the decisions has sparked debate, particularly as the company continues to reposition itself around artificial intelligence (AI) while scaling back other bets.
Layoffs Hit Multiple Teams
According to a report by The New York Times, the latest round of job cuts has affected employees across several divisions, including Reality Labs, recruiting, sales and Facebook teams.
Reality Labs, Meta’s unit focused on virtual reality and metaverse technologies, has been among the hardest hit. The division, which has reportedly incurred losses of over $80 billion, has now seen layoffs for the second time this year. Earlier in January, the company had cut around 1,000 roles in the same unit.
Some employees impacted in the latest round are being offered alternative roles within the company, though these may involve relocation.
A Meta spokesperson said, “Teams across Meta regularly restructure or implement changes to ensure they’re in the best position to achieve their goals.”
More Job Cuts Ahead?
The latest cuts may not be the end of the downsizing cycle. Previous reports have suggested that Meta could be planning to reduce as many as 15,000 jobs globally as part of a broader restructuring exercise.
The move reflects a wider shift in priorities, with the company reassessing investments in areas such as the metaverse while focusing more heavily on emerging technologies.
Senior Executives Get More Payouts
Even as workforce reductions continue, Meta has introduced a new stock option programme aimed at its senior leadership.
Announced a day before the layoffs, the scheme could increase compensation for top executives by up to $921 million (roughly Rs 8,660 crore) each over the next five years. The payouts are tied to an ambitious target of the company reaching a $9 trillion market capitalisation by 2031. Meta is currently valued at about $1.5 trillion.
The company has said that the incentive plan is designed to retain leadership talent and support long-term growth, particularly as competition intensifies in the AI space. Notably, CEO Mark Zuckerberg is not part of this stock award programme.
From Metaverse to AI
Meta’s recent actions highlight a clear pivot in its strategic direction. The company has been scaling back its metaverse ambitions, including halting further development in certain virtual reality initiatives.
At the same time, it is aggressively investing in artificial intelligence. Meta has acquired firms such as Moltbook and Manus AI to strengthen its capabilities in agentic AI. It has also brought in senior talent from competing firms, including former Google executives associated with the AI startup Dreamer.
Rising Costs and Delayed AI Rollout
The shift towards AI comes with significant financial commitments. Meta has projected spending between $162 billion and $169 billion in 2026, largely directed towards AI infrastructure, including the development of new data centres.
However, the transition has not been without challenges. The company has reportedly delayed the release of its upcoming AI model, Avocado, developed by Meta Superintelligence Labs (MSL), after it failed to meet internal performance benchmarks.
MSL is led by Alexandr Wang, who joined Meta following the company’s $14.5 billion acquisition of his startup, Scale AI.
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