Meta Plans Layoffs in Reality Labs as Company Shifts Focus From Metaverse to Artificial Intelligence

After major tech companies like Amazon, Microsoft, Intel, and Salesforce cutting thousands of jobs in 2025, Meta is also reportedly planning to cut jobs in its Reality division. The decision came after the tech giant shifts its focus from the Metaverse to artificial intelligence. This move also highlights company’s changing priorities as it invests more in AI research and data centers. Meta is also focusing on smart wearables while slowing the development of virtual reality products. As per report, Meta’s reality products have seen limited consumer demand.

Meta to Layoff Reality Labs

As per recent report, Meta is preparing to reduce its workforce in its Reality Labs division. The division was responsible for virtual reality and metaverse products. This layoff will affect notable portion of employees who were working on VR headsets and virtual social platforms. Meta comes up with this decision after the company noticed less and slow down consumer demand in some areas. As per tech giant virtual reality hardware has struggled to achieve mass adoption despite years of heavy investment.

Why Meta Is Focusing on Artificial Intelligence

While the company is planning to layoffs in its Reality division, at the same time it is also focusing and increasing its spending on artificial intelligence research and infrastructure. The company now sees AI as the central growth to its next phase of development, especially when the competition rises with its rivals. Companies like Amazon, Google, and more are building advanced language models and AI-powered services. This is the main reason that a significant part of Meta’s budget is now being directed toward data centers and computing power. In addition, the tech giant is also focusing on hiring top AI researchers worldwide.

Smart Glasses and Wearables Gain Importance

Recently Virtual Reality has started losing its momentum, and hence , Meta’s augmented reality and wearables division is gaining stronger support. Products such as advanced wristband, that are specifically based on computing devices are smart glasses are becoming more popular and easier for everyday use.

To recall, Meta’s AI-powered smart glasses are developed in partnership with Ray-Ban are not only performing well, but is also gaining popularity among young generation. The success of Ray-Ban Meta Glasses has encouraged the tech giant to shift its focus and resources toward technologies that blend AI.

Metaverse Vision Isn’t Fully Abandoned

The layoffs have not entirely ruled out the metaverse concept at Meta. Rather, the company is seemingly redefining the term. Instead of the entirely virtualized environments, Meta is currently experimenting with lighter, AI-enhanced experiences that can be supported by wearables and mixed reality. This will enable Meta to remain alive with its long-range vision and conform to the realities in the market.