Meta plans massive layoffs, 20% workforce likely to be affected amid rising AI costs. All you need to know

Tech powerhouse Meta, under the leadership of Mark Zuckerberg, is gearing up for substantial layoffs that could see around 20% of its workforce affected as it grapples with soaring costs associated with artificial intelligence (AI). According to reports, this move may lead to the elimination of approximately 16,000 positions from its nearly 79,000-strong team. The driving force behind these layoffs is the escalating expenses tied to AI, which are expected to reach a staggering $600 billion for data centers by 2028. Meta is shifting towards an AI-centric operational model, prompting significant cuts in various departments. The most impacted areas are likely to include Reality Labs, along with teams not directly focused on AI initiatives. Reality Labs has been under scrutiny for its high operational losses, and job reductions there are anticipated as the company transitions from immersive VR headsets and metaverse projects to AI-driven wearable technology. Additionally, positions in departments that do not align with Meta's newly established Superintelligence Labs (MSL) or its AI infrastructure are also on the chopping block. During a recent earnings call, Zuckerberg remarked on the transformative power of AI tools, noting that they enable a single skilled individual to accomplish tasks that previously required large teams, resulting in a streamlined workforce across the organization. In line with its 'Year of Efficiency' initiative, Meta is also looking to simplify its management structure to enhance decision-making processes. While AI remains a priority for the company, reports suggest that Meta is refining its AI divisions, moving away from broader research to concentrate on high-impact models such as Avocado and Mango. Furthermore, teams dedicated to routine administrative and operational functions face potential job cuts due to the increasing use of AI for improving internal efficiency. As for the timeline of these workforce reductions, no official date has been confirmed yet. Although internal planning is currently underway, Meta has labeled media speculations about the layoffs as unfounded.