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Meta to Cut About 10% of Reality Labs Workforce as Metaverse Push Scales Back

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Meta Platforms plans to cut around 10% of employees in its Reality Labs division, according to a report by the New York Times citing three people familiar with the discussions. The layoffs, which could be announced as soon as Tuesday, are expected to fall disproportionately on teams working on metaverse-related products, including virtual reality headsets and virtual social platforms.

Reality Labs employs roughly 15,000 people and has been at the center of Meta’s long-running bet on the metaverse, an immersive digital universe championed by Chief Executive Mark Zuckerberg. Since 2020, the division has burned more than $60 billion, as heavy investment failed to translate into mass adoption or meaningful revenue.

Beyond the metaverse, Reality Labs is responsible for several of Meta’s hardware initiatives, including Quest mixed-reality headsets, smart glasses developed in partnership with EssilorLuxottica under the Ray-Ban brand, and longer-term augmented reality glasses. While Meta has struggled to sell its broader vision of interconnected virtual worlds, its smart glasses have shown early traction—an area where rivals such as Google and Apple have so far failed to gain momentum with initial products.

According to the report, Meta Chief Technology Officer Andrew Bosworth, who oversees Reality Labs, has scheduled an in-person staff meeting for Wednesday and urged employees to attend, citing an internal memo.

Meta declined to immediately comment on the report. The planned cuts come as the Facebook parent faces growing pressure to refocus resources while trying to regain ground in Silicon Valley’s artificial intelligence race. Meta has recently struggled to generate enthusiasm around its latest AI efforts, including the Llama 4 model, adding to investor scrutiny over spending priorities.

Meta to Cut 600 Jobs in Superintelligence Labs as AI Unit Restructures

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Meta announced plans to cut approximately 600 positions within its Superintelligence Labs division, part of a restructuring aimed at making the company’s artificial intelligence operations more agile and efficient. The layoffs will impact teams across Facebook Artificial Intelligence Research (FAIR), product-related AI, and AI infrastructure, according to the company.

Meta said affected employees are encouraged to apply for other internal roles. However, the newly created TBD Lab — a smaller group of researchers and engineers developing next-generation foundation models — will remain untouched. Chief AI Officer Alexandr Wang emphasized that the reduction in staff would streamline decision-making and increase each member’s scope and influence.

The reorganization follows a period of leadership turnover and mixed reception to Meta’s Llama 4 open-source model. The company recently consolidated all AI initiatives under the Superintelligence Labs umbrella to accelerate progress in foundational and applied AI research.

Separately, Meta secured a $27 billion financing agreement with Blue Owl Capital to fund its largest data center project to date. Analysts say the deal could help Meta advance its massive AI infrastructure plans while mitigating financial risks.

TCS Layoffs Signal AI-Driven Transformation and Job Cuts in India’s $283 Billion IT Outsourcing Sector

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Indian IT giant Tata Consultancy Services (TCS) recently announced layoffs of over 12,000 employees, marking the largest workforce reduction in its history and signaling a broader AI-fueled shakeup expected to affect up to half a million jobs in India’s $283 billion outsourcing industry over the next two to three years.

Though TCS attributes the layoffs—about 2% of its workforce—to skill mismatches rather than direct AI impacts, experts see this move as the beginning of significant structural changes in a sector that employs 5.67 million people and contributes more than 7% to India’s GDP. AI technologies are increasingly automating roles across coding, manual testing, and customer support, reducing the need for labor-intensive processes.

Industry veterans and analysts warn that the most vulnerable employees include mid-career managers with limited technical skills, software testers, bug finders, and infrastructure support staff. Gaurav Vasu, founder of tech market intelligence firm UnearthInsight, estimates that 400,000 to 500,000 professionals could be laid off in the next few years due to skill gaps, with around 70% of the layoffs impacting workers with 4-12 years of experience.

The layoffs may also have broader economic repercussions, potentially dampening consumer spending in sectors like tourism, luxury retail, and real estate investments due to reduced disposable incomes among affected workers.

TCS and other major Indian IT firms such as Infosys, HCLTech, Tech Mahindra, Wipro, LTIMindtree, and Cognizant collectively employ hundreds of thousands of mid- to senior-level professionals who may face increased risk as AI adoption intensifies. Cost optimization demands from clients, alongside AI-driven productivity improvements, are pressuring IT companies to deliver more with fewer employees.

TCS, which had over 613,000 employees before the layoffs, said it is “future-ready” by investing in new technologies, AI adoption, new markets, and realigning its workforce. However, it has not clarified the extent to which AI automation directly influenced the layoffs or how displaced employees will be redeployed.

The layoffs and other internal policies have negatively impacted employee morale, with some mid-career staff citing difficulties in finding new jobs and dissatisfaction over bonuses, bench time policies, and project assignments.

The Indian outsourcing sector, a key driver of economic mobility since the 1990s, now faces a pivotal moment as AI and automation reshape how work is done. Industry body Nasscom described the sector as being “at an inflection point,” while former Tech Mahindra CEO CP Gurnani emphasized that unlike past technological shifts, AI demands individuals to reinvent and reskill themselves to stay relevant.