By George Glover
Meta Platforms is accelerating its pivot away from the metaverse, just over four years after the Facebook owner changed its name to signal it was going all-in on virtual and augmented reality.
The tech giant has laid off 1,500 people -- about 10% of staff -- from the Reality Labs division that is home to its metaverse efforts, The Wall Street Journal reported on Wednesday, citing a person familiar with the matter. The person added that Meta is shifting some investment to its Wearables division, which includes Ray-Ban Meta smart glasses.
Meta didn't immediately respond to a request for comment from Barron's.
The news didn't do much for Meta shares, which dipped 2.5% on Wednesday as investors continued to ditch megacap technology stocks, then edged up 0.5% ahead of Thursday's opening bell. Futures tracking the S&P 500 were 0.3% higher on Thursday.
CEO Mark Zuckerberg signaled he was staking the company's future on the metaverse in October 2021. "We're going to be metaverse first, not Facebook first," he said as he unveiled the name change.
It's tempting to see the layoffs as an embarrassing climbdown, but the pivot to smart glasses makes a lot of sense.
Demand for the AI-equipped product is so high that Meta and its partner EssilorLuxottica have discussed expanding annual capacity to 20 million units or more by the end of this year, Bloomberg reported this week.
In contrast, the metaverse has never really caught on as an idea, and Reality Labs has become a black hole for Meta.
Analysts estimate the division posted an operating loss of $18.9 billion last year, according to a FactSet poll. The Street is forecasting an overall operating profit of $82.4 billion.
Write to George Glover at george.glover@dowjones.com
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(END) Dow Jones Newswires
January 15, 2026 05:25 ET (10:25 GMT)
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