Meta CEO Mark Zuckerberg is preparing to implement a comprehensive budget cut for the company's metaverse projects. According to sources, Meta is planning cuts of up to 30% of its metaverse investments, with layoffs expected to begin in January 2026 at the earliest.
Meta Plans Major Cut to Metaverse Budget: Targets Shrinkage of Up to 30%
The planned cuts will reportedly affect the Horizon Worlds virtual universe, the Quest VR headset, and the related hardware ecosystem. Meta's primary reason for downsizing in these areas is to direct resources toward projects it sees as having faster growth potential, including AI-powered glasses, smart accessories, and other wearable technology.
While Zuckerberg maintains that his metaverse vision still has long-term value, Meta's unit, Reality Labs, has reported losses of over $70 billion since 2021. This massive financial burden has fueled outside criticism of the company's metaverse strategy, while Meta appears to be increasingly shifting its focus to developing AI technologies and hardware.
Industry analysts consider Meta's strategy shift an inevitable step, given that both Metaverse revenues haven't met expectations and the commercial opportunities for AI technologies appear much stronger. Meta is expected to make a formal announcement in the coming weeks.
*This is not investment advice.
