August 9, 2022
Facebook parent meta informs hardware employees about cutbacks, ensures no layoffs

Facebook-owned Meta Platform is preparing to cut its Reality Labs division, a unit at the heart of the company’s strategy to refocus on hardware products and “metaverse”, a spokesperson confirmed to Reuters on Wednesday. Of.

Chief technology officer Andrew Bosworth told Reality Labs employees during a weekly Q&A session on Tuesday that the changes would be announced within a week, according to a summary of their comments seen by Reuters.

A Meta spokesperson confirmed that Bosworth told employees the division could no longer afford to do some projects and that others would have to be postponed, without specifying which projects would be affected.

She said Meta was not planning layoffs as part of the changes.

The world’s largest social media company told investors last month that it would reduce costs in 2022, following a decline in Facebook users earlier this year as the stock tumbled.

In an earnings call in late April, chief executive Mark Zuckerberg said Meta plans to “slow down” the pace of some long-term investments in areas such as its business platform, artificial intelligence infrastructure and Reality Labs.

META reduced its projected 2022 total spending to between $87 billion (approximately Rs 6,73,499 crore) and $92 billion (approximately Rs 7,12,066 crore) from $90 billion (approximately Rs 6,96,586 crore). was lower than its earlier approach. ) and $95 billion (approximately Rs 7,35,339 crore). Last week, it told employees it was reducing hiring for most mid- to senior-level positions, as initially reported by Insider.

The 18-year-old tech giant has invested heavily in Reality Labs, which has grown from its Oculus virtual reality business and now works on augmented reality, smart glasses, Portal video-calling devices and enterprise tech solutions.

The unit is also making a mixed reality headset with face and eye tracking called Project Cambria, which Zuckerberg previewed in a post on his Facebook page on Wednesday.

Those investments are intended to establish Meta as a gateway to the Metaverse, a universe of immersive, shared, interconnected digital worlds that Zuckerberg has said he believes will be the successor to the mobile Internet. Will happen.

The company changed its name in October to reflect its Metaverse purpose and has largely hired Reality Labs to staff Reality Labs, adding more than 13,000 employees last year and nearly 6,000 in the first quarter this year.

Plus, Zuckerberg warns it could take nearly a decade for the Metaverse bets to pay off, and Reality Labs has blown the cash. The unit incurred a loss of $10.2 billion (about Rs 78,952 crore) in 2021 and $3 billion (about Rs 23,221 crore) in the first quarter of this year.

Zuckerberg told investors last month that he still aims to generate enough revenue from legacy apps Facebook, Instagram and WhatsApp over the next several years to fund investments in Realty Labs, while increasing profits overall. can be continued.

“Unfortunately, that’s not going to happen in 2022,” he said.

© Thomson Reuters 2022

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