What is happening with the metaverse?
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Answer
Meta is making significant budget cuts to its metaverse division, with reductions up to 30% and potential layoffs. While Mark Zuckerberg remains committed to virtual reality and augmented reality hardware, the company is shifting focus toward AI-powered smart glasses and other hardware projects, as the market for immersive virtual worlds has not met expectations. Investment in AI and AR glasses continues, but aggressive spending on the metaverse is being scaled back.
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Meta plans big cuts to its Metaverse efforts
- Meta leadership discussed budget cuts for 2026, focusing on the metaverse division
- Metaverse division could face up to 30% cuts, possibly including layoffs 29s
- Meta shifts focus to AR hardware and AI-powered glasses 1m 13s
- Virtual reality group expected to be impacted by metaverse cuts 2m 43s
- Investment in AI and hardware talent remains a priority for Meta 2m 58s
References
Meta leadership is reviewing budget plans with a focus on reducing costs in the metaverse division, which could see cuts up to 30% and potential layoffs. The company is shifting emphasis toward augmented reality hardware, such as AI-powered Ray-Ban glasses, as the market for immersive virtual worlds has not developed as anticipated. Investment in AR and AI projects continues, but spending on immersive virtual worlds is being reconsidered.
Meta is planning deep cuts for the metaverse, with some units facing up to 30% reductions, compared to the usual 10% year-end cuts. These may involve layoffs as early as January. Zuckerberg remains committed to virtual reality but is ready to limit further losses in the metaverse area, shifting focus toward advertising and possibly lowering capital expenditure guidance.