Meta (META.US) Plans 20% Workforce Reduction: "AI Replacement" to Optimize Human Resources Structure, Support Massive Capital Expenditures

According to reports, Meta (META.US) is planning to initiate large-scale layoffs that could affect 20% or more of its employees, involving approximately 16,000 jobs. The parent company of Facebook aims to offset its high investments in artificial intelligence and prepare for further efficiency gains brought by AI-assisted employees. It is reported that Meta plans to spend up to $600 billion on AI capital expenditures by 2028.

According to three informed sources, the company has not yet finalized the date for the layoffs, nor has the scale been definitively determined. Two of them stated that senior management has recently communicated this plan in discussions with other senior leaders and has asked them to start planning how to implement the layoffs specifically.

Despite Meta’s efforts to transform into an “AI-driven” company, its core model development process has recently faced significant setbacks, further intensifying internal restructuring pressures. Due to the underperformance of last year’s Llama4 series models in benchmarks, Meta was forced to abandon the planned summer release of the large-scale “Behemoth” version.

Additionally, internal projects codenamed “Avocado” and “Mango,” ultra-intelligent models, have also been delayed to May 2026 due to performance issues that failed to meet internal thresholds. This delay in development progress and the high costs involved have raised concerns among investors about whether the company can turn AI investments into actual profit growth in the short term.

Regarding these plans, Meta spokesperson Andy Stone responded that reports about large-scale layoffs are speculative and based on theoretical scenarios. According to Meta’s latest 10-K filing, as of December 31, 2025, the company has approximately 79,000 employees.

If finalized, a 20% layoff would be the largest since Meta’s restructuring plan from late 2022 to early 2023, when the company cut over 20,000 jobs. Previously, a hiring surge had doubled its workforce compared to 2020.

However, Meta’s move is not an isolated case but reflects the broader pain points of the tech industry’s current transformation. In January, Amazon laid off about 16,000 employees, and Jack Dorsey’s Block recently cut nearly half of its positions. These giants generally believe that with the application of AI automation tools in internal workflows, the company no longer needs the large-scale workforce it once had.