Meta Platforms this week notified employees that it will eliminate up to 1,500 positions—approximately 10%—from its Reality Labs division, which has employed roughly 15,000 people. This unit has generated more than $70 billion in cumulative operating losses since 2020 as consumer uptake of virtual-reality headsets and the VR-based Horizon social network remained muted. The cuts underscore pressure from investors and internal leaders, including prominent bears such as Nancy Tengler, to scale back the company’s metaverse ambitions in favor of more immediately accretive opportunities.

In response to record U.S. demand and extended waitlists stretching into 2026, Meta and partner EssilorLuxottica are reportedly weighing an increase in annual Ray-Ban Meta smart glasses manufacturing capacity from the current 10 million units to 20 million by year-end. Should demand continue its upward trajectory, the companies may further expand capacity to 30 million units. Meta paused planned rollouts in the U.K., France, Italy and Canada earlier this month, citing “unprecedented demand and limited inventory” in the United States.

Mark Zuckerberg has directed the company to prioritize AI-driven products and devices, shifting billions in capital expenditure toward data centers, research partnerships and smart-glasses development. Meta expects its 2026 capex budget to exceed the $70–72 billion range set for 2025. Concurrently, the company is overhauling its performance and bonus framework to reward top AI talent with up to 300% of base bonuses, reinforcing a sharper performance curve. These strategic moves aim to leverage Meta’s core advertising engine—which delivered more than $60 billion in annualized revenue from AI-powered ad tools—to underwrite heavy AI investments while scaling back metaverse losses.