Meta CEO Mark Zuckerberg is preparing to implement sweeping budget cuts to the company’s Metaverse projects. Meta plans to cut its investment in Metaverse by up to 30%, with job cuts expected to begin as early as January 2026, sources said.
Meta plans to drastically reduce Metaverse budget: Targeting up to 30% reduction
The planned cuts will reportedly impact the Horizon Worlds virtual world, Quest VR headsets, and related hardware ecosystem. Meta’s main reason for scaling back in these areas is to direct resources to projects it sees as having faster growth potential, such as AI-powered glasses, smart accessories and other wearable tech.
Although Zuckerberg maintains that his Metaverse vision still has long-term value, Meta’s arm, Reality Labs, has reported losses of more than $70 billion since 2021. While this huge financial burden has fueled external criticism of the company’s Metaverse strategy, Meta appears to be increasingly shifting its focus to developing AI technology and hardware.
Industry analysts believe Meta’s strategic shift is an inevitable step, given that Metaverse’s revenue has been lower than expected and the commercial opportunity for AI technology appears to be much greater. Meta is expected to make an official announcement in the coming weeks.
*This is not investment advice.