SAN FRANCISCO: In a recent development, it has come to light that Meta is contemplating staff reductions within its Reality Labs division, which is heavily invested in the metaverse.

Employees have reportedly been notified about the impending layoffs through an internal communication on Meta's Workplace forum, as reported by sources to Reuters.

The personnel cuts are set to affect the Facebook Agile Silicon Team (FAST), a crucial unit boasting approximately 600 members. Such a move could potentially hinder Mark Zuckerberg's ambitious vision for augmented and virtual reality (AR/VR).

Meta is banking on a substantial investment of $10 billion in the upcoming years to spearhead its foray into the metaverse. However, the company has faced challenges in manufacturing chips for its AR-VR headsets that can effectively compete with those produced by third-party providers.

For the year 2022, Meta (formerly known as Facebook) incurred staggering operating losses amounting to $13.7 billion within its Reality Labs division, dealing a significant blow to its AR-VR and metaverse aspirations.

Within the Reality Labs segment, Q4 revenue experienced a 17% decline, falling to $727 million, primarily attributed to reduced sales of the Quest 2 headset.

More than a year after Mark Zuckerberg's initial announcement of the metaverse project, internal documents surfaced, revealing struggles with "technical glitches, lukewarm user interest, and a lack of clear direction for achieving success."

In October of the preceding year, a prominent long-term investor in Meta voiced concerns about the company's excessive spending on the metaverse, suggesting it was time to recalibrate to regain its competitive edge.

Brad Gerstner, Chair and CEO of Altimeter Capital, commented on the metaverse, expressing widespread confusion among people about its fundamental meaning.

Over the past year, Meta has undergone significant downsizing, cutting close to 21,000 jobs across various sectors.

Just recently, Meta unveiled its latest mixed reality (MR) headset, Quest 3, boasting a 30% improvement in visual resolution and a 40% boost in audio volume compared to its predecessor, Quest 2.

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