Meta Cuts AI Division Jobs Despite Billions in Spending

For a large portion of this year, Mark Zuckerberg recruited staff members from competing tech firms including OpenAI, Apple, and xAI to work for his artificial intelligence division, Meta’s Superintelligence Labs (MSL). Alexandr Wang, the company’s chief AI officer, reportedly informed staff members in October that the business would be eliminating 600 positions.

The Bloomberg report, which referenced an internal memo for the information, noted that Meta’s recently established TBD Lab group, which comprises many of the high-paid recent hires, has not been impacted.

50 personnel, including those that were stolen from Apple, Anthropic, xAI, Google, and OpenAI for packages worth up to $100 million, have purportedly been onboarded by MSL. Wang joined Meta as the head of its AI initiatives after the company invested $14.3 billion in data labelling startup Scale AI, one of the billions it spent to hire top people from across the business.

The sacked employees are being encouraged to apply for positions in other departments by Meta, a source told Bloomberg. The individual stated that the business intends to continue employing for its AI teams in the future, in accordance with the report.

However, it appeared that these layoffs were inevitable. The Wall Street Journal said on August 20 that Meta has put a halt to hiring for its AI branch. Reuters was informed by a corporate representative that Meta is “undertaking yearly budgeting and planning exercises” and that the freeze is a component of its “basic organisational planning.”

Meta’s recent layoffs are not exactly unique and looking at other major companies that have cut roles in relation to AI are not alone as well despite the fact that they spent billions on resources of varying kinds. Some have also declared layoffs, citing the industry’s transformation due to AI.

The business is also still dedicated to expanding its AI models and investing in additional AI infrastructure in order to compete with companies like Google, Amazon, and OpenAI.

According to an article from Wired, Google claimed to have fired more than 200 contractors in September who were involved in its AI initiatives, including Gemini and AI Overviews. Google’s AI systems were being trained and improved by these workers, the newspaper was informed by sources. Furthermore, as part of its continuous effort to speed up AI, Alphabet-owned Google reportedly cut off 100 design department staff on October 2. As per a CNBC report, the affected staff members used data, surveys, and other instruments to comprehend and apply consumer behaviour in product development and design.

Also, TCS, the tech division of the conglomerate Tata Group, has let off 1% of its workforce worldwide, or 6,000 people, and has plans to lay off an additional 6,000 as part of its reorganisation and AI drive. In spite of this, TCS said on October 10 that it would be reorganising by opening an AI experience zone and design studio in London, UK. 5,000 new jobs are expected to be created in Britain over the course of the next three years.

Nearly 15% of the internet giant’s employees will be let go from departments including consumer business and human resources, among others. Chief executive officer Andy Jassy has been outspoken in his support of AI adoption, warning that those who do not adjust will fall behind. Andy Jassy stated in a business memo in June that “those who embrace this change, become conversant in AI, help us build and improve our AI capabilities internally and deliver for customers, will be well-positioned to have high impact and help us reinvent the company.”

As AI tools are being used, CEO Marc Benioff announced 4,000 job layoffs in customer service. The total number of Salesforce workers working in customer service has decreased from 9,000 to 5,000.

Amidst the company’s intensified AI drive, Accenture, an IT consulting firm, announced 11,000 job layoffs across its global workforce on October 8.

In spite of this Meta may spend between $114 and 118 billion in 2025, and in 2026 in which AI will still likely drive even greater expenses.

Meta’s long-term commitment is demonstrated by the company’s 29th data centre, a campus in El Paso, Texas, with the capacity to scale up to 1GW. It is already claimed to “support both the traditional servers of today and future generations of AI-enabled hardware.”

Zuckerberg hasn’t let go of as many people as we may have anticipated since informing staff that it would be a “tough year” and firing 3,600 employees in February 2025; according to layoffs.fyi, he let off 600 employees this month and 100 in April.