Meta is expected to reduce its workforce by 10% within its Reality Labs division, which focuses on metaverse initiatives

Meta, the owner of Facebook, is expected to reduce its workforce by 10% within Reality Labs, the division focused on metaverse, virtual reality, and augmented reality. According to The New York Times, these layoffs might be revealed as soon as Tuesday, January 13.

Additionally, Business Insider noted that Andrew Bosworth, Meta's chief technology officer, scheduled a critical meeting on Wednesday, January 14, urging Reality Labs employees to attend in person. Bosworth described the meeting as the "most important" of the year without sharing further details.

Reality Labs currently comprises approximately 15,000 of Meta's 78,000 total employees. In December 2025, it was reported that Meta aimed to slash budgets by up to 30% throughout 2026, with Reality Labs being a primary focus due to minimal metaverse competition and financial pressures from significant losses in this segment.

Previously, a Meta spokesperson mentioned reallocating investments from the metaverse to AI glasses and wearables, citing their increasing momentum. In the last quarter of 2024, Reality Labs generated $1.08 billion in revenue but faced an operational loss of $4.967 billion. For the entire 2024 fiscal year, the division earned $2.1 billion in income but recorded a $17.7 billion loss.

During the third quarter ending September 30, 2025, Reality Labs reported $470 million in revenue and a $4.4 billion loss, with Meta's CFO Susan Li forecasting decreased revenue for the year's final quarter. Since its rebranding to Meta in 2021, the company has seen over $70 billion in losses related to its metaverse initiatives.