Meta Platforms Cuts Metaverse Spending

Meta Platforms, led by CEO Mark Zuckerberg, is planning significant budget cuts, potentially up to 30%, for its metaverse division, Meta Platforms — Reality Labs, as part of its 2026 annual budget planning. This move comes after Meta Platforms — Reality Labs has incurred losses exceeding $70 billion since 2021 and Meta Platforms has not seen the anticipated industry-wide competition in the metaverse space. The cuts are expected to primarily impact Meta Platforms' virtual reality group and Horizon Worlds, and may include layoffs as early as January. Mark Zuckerberg is now publicly focusing on developing large AI models and related hardware products, such as Meta Platforms' Ray-Ban smart display glasses, signaling a strategic shift away from the metaverse. Analysts from Forrester Research had previously predicted the shuttering of Meta Platforms' metaverse projects, advocating for a greater focus on AI initiatives like Llama and Meta AI. Despite these cuts, Meta Platforms remains committed to building consumer hardware, evidenced by its recent hiring of a top design executive from Apple Inc..