Meta CEO warns more layoffs possible, blames capital spending for AI

Meta Chief Executive Officer Mark Zuckerberg blamed AI and capital spending for recent layoffs and said more could be coming.

Zuckerberg spoke to employees at a company town hall on Thursday, according to Reuters. The announcement from the CEO marks the first time he has addressed employees directly about the layoffs since the plan was first announced. 

What they’re saying:

“We basically have two major cost centers in the company: compute infrastructure and people-oriented things,” Zuckerberg said in the session. “If we’re ​investing more in one area to serve our community, then that means we ​have less capital to allocate to the other. So that means we ⁠do need to take down the size of the company somewhat.”

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The backstory:

Last month, Meta announced they were cutting roughly 8,000 jobs, about 10% of their workforce, teasing an additional second round later in the year. 

Big picture view:

According to Reuters, several employees have spoken up, criticizing the company leaders’ internal message forum about the changes. 

The company has not spoken publicly about the layoffs amid their transformation into a more AI-oriented organization and new initiatives that use employees’ mouse movements, clicks and keystrokes to train AI agents.

The other side:

Zuckerberg said the cuts were not related to their reorganization of teams around a new AI native structure that is designed to build AI agents to do tasks autonomously.