Meta CEO Plans Significant Cuts to Metaverse Budget for 2024

Meta Platforms CEO Mark Zuckerberg is reportedly considering significant reductions to the budget for its metaverse initiatives. This decision comes as the company reassesses its growth strategy, which had previously positioned the metaverse as a key area for expansion. According to a report from Bloomberg, executives are evaluating a potential budget cut of 30 percent for the metaverse sector in 2024, impacting both Meta Horizon Worlds and the Quest VR division.

At a recent annual budget meeting, Zuckerberg instructed company executives to implement 10 percent reductions across various departments. This latest directive appears to be a continuation of budgetary constraints that have been in place for the past few years. Sources cited by Bloomberg indicate that deeper cuts are being considered for the metaverse division due to lower-than-expected competition in this space.

Implications for Workforce and Future Investments

The proposed budget cuts are expected to include layoffs, which could occur as early as next month, although formal decisions regarding staffing have yet to be confirmed. The majority of the financial reductions are likely to affect the virtual reality group, which represents a substantial portion of Meta’s metaverse-related expenditures.

Zuckerberg has been a vocal advocate for the development of the metaverse, a vision that led to the company’s rebranding from Facebook to Meta Platforms in 2021. The company’s Reality Labs division is responsible for its augmented reality (AR) and virtual reality (VR) technologies, yet it has continued to incur significant financial losses, amounting to billions of dollars.

A spokesperson for Meta Platforms stated that the company is redirecting some of its investments from the metaverse to focus on the development of AI glasses and wearables, which the company believes have more immediate market potential. “We aren’t planning any broader changes than that,” the representative remarked.

As Meta navigates these financial challenges, the implications for its metaverse ambitions remain uncertain. The company’s strategy will likely continue to evolve as it weighs the potential for growth in alternative technological avenues against the backdrop of its existing investments.