Meta reportedly considering layoffs that could affect 20% of the company
Meta announced it is evaluating layoffs that could affect up to 20% of its workforce, potentially cutting 50,000 employees, according to TechCrunch.
The decision follows a surge in AI-related investment, including the $2.5B purchase of startup Cohere and the launch of Meta AI Lab’s Llama 3 model, which have strained the company’s balance sheet.
Reducing staff will help Meta balance its books, but may slow innovation in its AI research division. The move signals a shift from aggressive growth to consolidation, potentially prompting other tech firms to reassess their AI spend. Meta still plans to double its AI investment next year, indicating a hybrid strategy.
Employees in AI research, engineering, and product teams are most at risk. Investors will monitor the final headcount and the effect on Meta’s Q2 earnings. The broader AI sector may see a slowdown in hiring as companies weigh cost versus capability.
- Meta may cut 50,000 staff to offset AI costs.
- AI research could slow amid layoffs.
- Other tech firms may tighten AI budgets.