Meta Plans to Cut 20% of Staff While Pouring Billions into AI

Meta is about to make a striking move. The company reportedly plans to lay off one-fifth of its entire workforce, even as it continues spending hundreds of billions of dollars on artificial intelligence infrastructure.

That tension says a lot about where Meta stands right now. Massive ambitions, rising costs, and very few public victories to show for it.

Reuters Report Breaks the Story

According to an exclusively sourced Reuters report, Meta executives have already begun asking their peers to plan for the cuts. Three anonymous sources confirmed the layoffs are coming, though no exact headcount or timeline has been set yet.

Meta did not immediately respond to a request for comment.

The reasoning behind the cuts is twofold. First, Meta believes AI agents can now handle tasks that previously required full-time human workers. Second, the company needs to trim costs as it races to build out expensive AI infrastructure. So the same technology driving investment is also justifying the job losses.

Avocado AI Model Faces Serious Delays

Here’s the uncomfortable reality. Meta has poured enormous resources into AI but has very little to publicly show for it.

CNET AI expert Katelyn Chedraoui put it plainly. “Meta has been spending big to keep up with its AI ambitions, from hiring to data center construction. But all that cash hasn’t led to many public wins, with recent reports saying it will delay the release of its new foundational model, named Avocado. Rumors of cost-cutting measures like layoffs are another sign Meta is struggling.”

Avocado isn’t an isolated stumble, either. Meta also ran into a rough stretch last year trying to bring its Llama 4 large language models to the public. Delays and setbacks piled up across multiple projects.

![A stylized graphic showing Meta’s logo with dollar signs and AI circuit board imagery representing the company’s costly AI spending surge alongside planned workforce reductions]

AI-Powered Smart Glasses Caught in Legal Trouble

Beyond the model delays, Meta’s AI-powered smart glasses recently landed the company in a class action lawsuit. The suit centers on allegations that the glasses captured sensitive information, including nudity and otherwise private encounters.

That’s a serious blow to one of Meta’s most visible next-generation hardware bets. And it adds to the sense that many of Meta’s ambitious AI projects are hitting walls simultaneously.

Zuckerberg’s Expensive Talent War

CEO Mark Zuckerberg has not been shy about spending. He personally drove a $14.3 billion deal to poach Scale AI’s co-founder and reportedly offered $100 million signing bonuses to engineers from OpenAI.

Meta also created what it calls a “superintelligence team” dedicated to achieving artificial general intelligence (AGI). Plus, the company recently purchased Moltbook, a social networking platform built for AI, and is acquiring Chinese startup Manus for $2 billion.

And despite the planned layoffs, Reuters reports Meta still intends to spend $600 billion on data centers by 2028. That number is almost hard to process.

This Has Happened Before at Meta

The scale of these potential layoffs wouldn’t be new territory for Meta. The company cut 21,000 employees between 2022 and 2023 during its so-called “Year of Efficiency.” However, this would mark the first time Meta has pursued cuts of this magnitude since aggressively pivoting to build its own AI models.

Earlier this year, Zuckerberg told investors that he saw “projects that used to require big teams now be accomplished by a single very talented person.” That framing makes the layoff plans feel less like crisis management and more like a deliberate long-term strategy.

Silicon Valley’s AI Layoff Pattern

Meta would also be far from alone. Over the past several months, Amazon, Block, and Atlassian have each announced significant layoffs, with all three citing greater reliance on AI tools as part of their reasoning.

The pattern is becoming hard to ignore. Companies invest heavily in AI, use that same AI to justify cutting headcount, then reinvest the savings back into more AI development. It’s a cycle that is reshaping the tech industry fast.

What This Means

For Meta employees, the uncertainty is real and the stakes are high. For the rest of us watching from the outside, this story captures something bigger about how Silicon Valley is changing.

Spending $600 billion on data centers while cutting one in five employees tells you everything about where tech companies think the future lives. The bet is enormous. So is the pressure to deliver results.

The Avocado delays, the Llama 4 struggles, and the smart glasses lawsuit all suggest Meta hasn’t cracked the code yet. Whether cutting staff helps or hurts that mission remains an open question. But one thing is clear. Zuckerberg is all in, and he’s not slowing down.