Meta's new cost-saving move: Reality Labs will face personnel adjustments

Meta Platforms is quietly adjusting its hardware division’s resource allocation. According to reports on January 13, multiple informed employees revealed that the social media giant plans to optimize its VR business within Reality Labs, with 10% to 30% of employees in that department potentially receiving notification of adjustments next month. Behind this move is Meta’s strategic weighing between the two technological paths of virtual reality and augmented reality.

Cost considerations behind the “downsizing” of the VR department

The Reality Labs division currently consists of the Metaverse team and the Wearables team. The department is mainly responsible for VR headset development and building social platforms based on VR technology. Insiders disclosed that management is contemplating significant cuts to VR-related positions, aiming to redirect the saved funds toward AR glasses projects. This reflects Meta’s reassessment of its long-term investment strategy in the virtual reality field.

AR glasses become a new investment focus

Contrasting with the contraction of VR business, Meta’s performance in augmented reality is gaining recognition from top executives. As early as 2021, Meta partnered with Ray-Ban to launch its first AR glasses product. Notably, the sales of this product have already far exceeded Meta’s original internal targets. This unexpected market success has provided Meta with a new development direction: rather than continuing heavy investments in building virtual worlds, it is better to concentrate resources on conquering augmented reality, a field closer to consumer needs.

Industry reflections behind cost savings

By adjusting the personnel allocation in Reality Labs, Meta is essentially reordering priorities. Virtual reality requires building a complete virtual ecosystem, with long investment cycles and unclear commercial monetization paths; whereas augmented reality can integrate more quickly with real-life scenarios and has stronger commercial feasibility. By shifting resources from VR to AR, Meta aims to achieve breakthroughs in its hardware ecosystem in a more cost-effective and efficient manner.