Meta has begun laying off more than 1,000 staff from its Reality Labs division, the unit behind the company’s virtual reality (VR) and metaverse products, Bloomberg reports. The restructuring signals a major strategic shift, with Meta now prioritising wearable technology, including its AI-powered Ray-Ban smart glasses, according to an internal memo from CTO Andrew Bosworth.
The move was widely anticipated after Reality Labs reported losses exceeding $70 billion since early 2021. While Meta has successfully launched popular VR headsets and smart glasses, the division has struggled to generate sustainable profits that justify its significant investment.
The challenges reflect broader difficulties with CEO Mark Zuckerberg’s metaverse vision, which prompted the company’s rebrand from Facebook to Meta in 2021. Despite the rebrand, adoption of metaverse platforms has been slow, and revenue growth has remained limited.
Bosworth’s memo outlines a new strategy that prioritises mobile platforms, leveraging their larger user base and faster growth compared with metaverse products. This approach will combine existing mobile applications with future wearable devices.
Bosworth wrote, "With the larger potential user base and the fastest growth rate today, we are shifting teams and resources almost exclusively to mobile to continue to accelerate adoption there."
Meta is not abandoning VR entirely. Bosworth stressed that the VR division will continue, but as a leaner and more focused operation aimed at long-term sustainability. This will mean fewer resources for VR development and delays in new product launches, including a successor to the Quest 3 headset.
The restructuring aligns with a wider tech industry trend, as companies increasingly favour AI-driven wearables and mobile experiences over high-cost, slow-to-adopt metaverse platforms. For Meta, the pivot could improve financial stability while strengthening its position in the emerging AI-powered consumer technology market.
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