Meta Shifts Focus: VR Layoffs as AI Wearables Take Center Stage

• Meta Platforms initiated significant layoffs in its Reality Labs division, impacting over 1,000 employees (10% of the division) on January 14, 2026.
• The job cuts signal a strategic pivot from a 'metaverse-first' vision and Virtual Reality (VR) investments towards AI-powered wearables and mobile integration.
• Reality Labs, responsible for Meta's metaverse efforts, has incurred losses exceeding $70 billion since its inception.
• The restructuring led to the closure of several VR game studios like Armature, Sanzaru, and Twisted Pixel, and halted new content development for the VR fitness app Supernatural.
• Meta aims for greater sustainability by reallocating investments to support wearables growth and focusing on third-party developers for gaming.

Why It Matters: Meta is cutting VR jobs and shifting its strategic focus to AI wearables and mobile integration.