I=9 Meta planning to layoff 20% or 15,800 of its employees, Rueters reported
No exact date of the job cuts or the magnitude of the layoff has been set, Reuters reported.
Meta spokesperson said the report is speculative.
“This is speculative reporting about theoretical approaches,” Meta spokesperson Andy Stone.
Assessment
This could be the result of efficiency gains from AI. During Q4 2025 earnings call, Meta CEO Mark Zuckerberg said AI is already improving productivity at Meta, with some projects that once needed large teams now being done by a single talented person (Q4 2025 Meta Platforms Earnings). While Meta spokersperson termed the Reuters report as speculation, past speculations on Meta’s strategy have often turned out to be true.
I=7 Meta is laying off 1.3% or 1,000 employees across several divisions
The layoff will affect teams across several divisions, including sales, recruiting and the Reality Labs hardware division, Bloomberg reported citing a person familiar with the matter.
A Meta spokesperson said some of the affected employees will be given roles in other divisions.
The layoff is much less than the 15,800 reported 10 days ago by Reuters but it could just be the first phase of the layoff.
Meta cut more than 1,000 jobs in the Reality Labs division in January as it shifts resources to AI.
I=7 Meta Platforms targets May 20 for its layoff of 8,000 employees due to AI efficiency gains, Reuters reported citing company sources
Meta Plans to lay off 8,000 employees (around 10% of its global workforce) on May 20, Reuters reported citing three sources familiar with the matter.
Meta also plans another layoff in the second half of the year but its magnitude is not yet settled.
Last month, Reuters reported that Meta was planning to layoff 20% of its employees but Meta’s spokesperson had termed the report as “speculative reporting about theoretical approaches”.
I=7 Meta confirms plans to lay off 8,000 employees on May 20, adds that it will cancel 6,000 open roles
“Over the last few weeks we have been working on some changes to our organization that will result in us laying off around 10% of the company on May 20, and closing about 6,000 open roles,” Janelle Gale, chief people officer said in a memo seen by Bloomberg.
Bofa analyst Justin Post estimates that a 20% employee reduction could save Meta around $7 billion to $8 billion annually, assuming average employee costs of around $500,000.
JPMorgan analyst Doug Anmuth estimates that a 20% employee reduction could save Meta around $5 billion to $6 billion annually, assuming costs of about $300,000 to $400,000 per employee.
I=5 Meta will enter cloud computing if it overspends on data centers, said no current plans for stock splits and Reality Labs losses will start declining next year
Zuckerberg reiterated that renting out data centers remains an option if they overbuilt them (min 56:19).
“It’s definitely on the table,” Zuckerberg said on Wednesday at Meta’s annual shareholder meeting. “Obviously if we get to a point where we feel that we have overbuilt, then that is an option that we have, and that is partially what gives us confidence in investing in building this out.”
“Almost every week there are different companies that come to us from outside asking us to both stand up an API service or asking if we have compute that they could buy from us at some premium to what we’ve bought it at.”
He said Reality Labs losses will start declining from 2027 due to maturity in supply chains and operational efficiency (min 50:48).
“As Rody shared, we expect that our investment levels in Reality Labs this year will result in operating losses that are similar to 2025. Beyond 2026, we expect we will gradually reduce Reality Labs losses as we benefit from more mature supply chains, from scaling wearables and VR, and generate higher margin revenue lines, and also continue to operate more efficiently. This remains an important investment, but we’re focused on ensuring that we’re improving the investment profile from where it is today.”
CFO Susan Li said they currently don’t have plans for stock split (min 53:05).
I=7 Mark Zuckerberg admitted Meta made mistakes in its AI restructuring and will likely make more, amidst declining employee morale
He reiterated that they don’t expect further layoffs this year but won’t overpromise.
“Given the complexity of these changes, we’ve made mistakes and will almost certainly make more,” he said. “I don’t want to overpromise because the world is changing in ways that are out of our control,” he added.
He said the 7,000 employees transferred to the newly created AI initiatives serve as a backup plan if they make mistakes in some places.
“By creating important new roles for people, this also allowed us to shrink the size of teams knowing that if we make mistakes in some places, then we could transfer some people back,” Zuckerberg said.
Zuckerberg was addressing declining morale at the company, especially in the Applied AI team where more than 6,500 employees feel dissatified with what they are doing.
“It’s literally the gulag,” one of the employees claims. “You have zero purpose in life all of a sudden, you barely interact with anyone, you just have these tasks every week."
