Meta Platforms has reportedly laid off 100 workers at Reality Labs, the division responsible for its virtual reality and augmented reality software and hardware, according to sources familiar with the matter. The cuts have also impacted teams within Meta’s Oculus Studios as well as some employees from Reality Labs’ hardware division.
Meta Platforms’ latest layoffs follow its admission last April that the AR/VR division had lost more than $1 billion monthly for most of the last two years. The firm also expected losses to surge as it deepened its investment.
Meta Platforms lays off over 100 employees at Reality Labs
Facebook owner Meta has reportedly laid off around 100 workers at Reality Labs, its virtual reality and augmented reality software and hardware division, including Quest. According to sources familiar with the matter, the cuts have impacted teams within Meta’s Oculus Studios, which is focused on developing games for the firm’s Quest headsets. He noted the cuts also impacted employees from Reality Labs’ hardware arm.
Meta Platforms spokesperson Tracy Clayton acknowledged that the layoffs impacted titles such as Supernatural, the VR fitness game that Meta Platforms acquired for over $400 million and successfully defended from a government antitrust lawsuit attempting to block the sale. The fitness app noted on its official Facebook group that “these changes are meant to help us work more efficiently on what the future of fitness could be.”
Supernatural said that it will reduce weekly workout releases due to the latest transition and adjustment of its team size. The company also added that it will release more workouts with a multi-intensity option to allow users to choose the intensity that suits them best.
Meta Platforms spokesperson Tracy Clayton also acknowledged that some Oculus Studios teams had undergone structure and role shifts that have impacted team size.
“These changes are meant to help Studios work more efficiently on future mixed reality experiences for our growing audience while still delivering great content for people today.”
-Tracy Clayton, Meta’s Spokesperson.
Clayton noted that the company is committed to investing in mixed reality experiences, including fitness and games. He added that Meta is also committed to delivering the best experiences possible for the Quest and that Supernatural communities remain unchanged.
Meta Platforms wants to make Reality Labs more efficient
Meta's Reality Labs unit lost another $4.4 billion in Q3, bringing its cumulative losses since 2020 up to $55 billion. $META pic.twitter.com/Y2pjwnDVho
— Charlie Bilello (@charliebilello) October 30, 2024
Last year, the tech company’s Reality Labs division lost $4.4 billion during Q3, and expects those losses to “increase meaningfully year-over-year” due to ongoing development efforts. The firm also reported a staggering $4.97 billion loss in the fourth quarter of 2024 while generating just $1.1 billion in revenue.
According to the company’s fourth-quarter earnings report, Meta’s Reality Labs has accumulated over $60 billion in operating losses. Meta’s CFO, Susan Li, was asked last year when spending would begin to slow down, and she said the company was having a “budget conversation” that included how to make Reality Labs more efficient.
Li also argued that part of the budget conversation included what places Meta can be more efficient in Reality Labs to give room to expand its ambitions around things like smart glasses. She also acknowledged that the firm was mulling over how it could “build the most flexibility into the way that we’re thinking about either infrastructure or headcount plans.”
The tech firm has reduced staff members during the last few years, laying off more than 20,000 jobs in 2022 and 2023. Lone Echo developer Ready at Dawn, which Zuckerberg’s company acquired in 2020, was significantly impacted by those cuts and was shut down at the end of last year.
The company’s CEO, Mark Zuckerberg, announced plans to allocate between $60-65 billion toward capital expenditure in 2025 to enhance its computing infrastructure related to artificial intelligence. Meta’s CTO Andrew Bosworth also previously warned that the company’s losses could not continue indefinitely, with rumors of potential closures if 2025 doesn’t show improvement for Reality Labs.
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