The expected impact on projects like Meta Platforms’ Horizon Worlds has raised alarms across the company and its developer ecosystem, Bloomberg reports. The planned financial adjustment, which could come into force as early as 2026, would particularly affect the team responsible for virtual reality technologies and the development of important platforms related to the metaverse. This reduction in investments increases the possibility that the pace of innovation will slow down and, moreover, threatens the sustainability of hundreds of professionals focused on the field of virtual worlds. The central news is that Meta, the parent company of Facebook, WhatsApp and Instagram, is considering significant cuts in its Metaverse division, including staff layoffs, according to data published by Bloomberg and reproduced by various international media outlets.
The proposal under study envisages a budget cut of up to 30% in funding the areas responsible for building and maintaining the virtual world environment. Bloomberg reported that these cuts respond to both the need to rationalize spending within the conglomerate and the below-expected results in terms of consolidation and adoption of the metaverse among users and enterprises. Although the layoffs have not yet been finalized in terms of date or scope, sources cited by Bloomberg suggested they could be formalized in January. However, the Meta board is still examining various alternatives before making a final decision on the size and scope of the measure.
This possible reduction is part of Meta’s budget planning for the next two years and comes against the backdrop of cost pressures across the company. Mark Zuckerberg, president and CEO, had already asked his management teams to cut spending by nearly 10%, a goal that had been proposed in previous years. For the department in charge of the metaverse, the need for adjustment is more serious due to high operating costs and slow return on investment, Bloomberg explained.
The media mentioned that the planned withdrawal of funds would have an immediate impact on developments such as Horizon Worlds, an environment that the company represents as one of its strategic pillars for the future of virtual reality. To sustain these projects, Meta has continuously invested in software, hardware and highly specialized human resources. According to published reports, the new budget policy could slow technological progress and lead to staff cuts, impacting engineering, design and management teams.
In the last fiscal year, Meta’s commitment to consolidating its own metaverse required multimillion-dollar investments, including the development of devices such as Oculus glasses and platforms for users and content creators. Bloomberg added that despite this infusion of resources, the company failed to consolidate its user base or achieve the expected economic benefits, justifying the urgency of this realignment.
Regarding the internal restructuring process, sources cited by Bloomberg stated that it is one of the most significant restructurings since the company’s name change and its focus on the metaverse. The budget reviews were not limited to this area, but adjustments in other areas were also analyzed to ensure the achievement of the economic objectives defined for 2026.
One of the key factors taken into account by the board is the analysis of the operating costs compared to the tangible return in the immersive technologies segment. Despite the initial enthusiasm for the company’s vision of being a world leader in virtual reality, internal indicators and changes in the technological scenario have led the company to change its investment priorities, the financial media reported. In this way, an attempt is made to redirect resources towards business areas and the expansion of priority products and services, and to shift some of the pressure to less profitable areas or areas with a higher level of uncertainty.
Formal notifications to affected employees on a large scale have not yet begun, according to Bloomberg, although human resources teams and executives have made progress in preparing possible adjustment scenarios. The stated intention is to minimize the negative impact on the company’s overall operations and to ease the transition for workers in the event of retrenchments.
More immediately, the news sparked concern among internal employees and technology partners who rely on the sustainable development of virtual worlds. Bloomberg noted that monitoring the implementation of these measures will be crucial in determining whether Meta is able to maintain its position in the immersive digital environments industry amid growing financial pressures and stricter profitability expectations.