Meta faces layoffs and internal criticism amid AI race

Meta's office in Menlo Park, California, United States
REUTERS/Nathan Frandino
Rain of layoffs, employee surveillance, brain drain. At Meta, the race for artificial intelligence (AI) takes a toll: a toxic internal climate that not even the technology giant's prosperity can appease.
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For more than a year, the parent company of Facebook, Instagram and WhatsApp has been facing staff reductions, a chaotic reorganization of its AI research and intense pressure on its employees.
This instability contrasts sharply with your financial situation. Driven by advertising, which represents the majority of its revenue, Meta recorded profits of almost 23 billion dollars (119 billion reais, at current prices) in the first quarter, an increase of 30% compared to the previous year.
On the other hand, its AI investment spending has soared. Mark Zuckerberg, its founder with almost absolute power, decided to impose drastic cuts and greater supervision over his teams.
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This year, the company eliminated approximately 8,000 positions, almost 10% of its workforce. Layoffs, job cuts and forced transfers affected almost a fifth of employees in just one year.
The American press is full of reports describing a "culture of fear", where everyone fears the next wave of layoffs and rumors paralyze work.
These cuts fund a frantic race for infrastructure: Meta plans to invest up to $145 billion in artificial intelligence this year, almost double last year's amount.
That's the logic behind the controversial "Model Capabilities Enhancement Initiative," launched in April and suspended on June 22. It recorded clicks, keystrokes and browsing history of employees in the United States to train AI agents.
Zuckerberg defended it during an internal meeting: "AI models learn by watching really smart people do things," he said, according to Wired.
However, more than 1,600 employees signed a petition to stop the initiative, with some comparing Meta to a "data extraction factory."
A system failure ended up exposing private conversations and performance metrics to all employees, which led to their suspension.
"While we have no indication that employees accessed this data, we are suspending the initiative while we investigate," said a Meta spokesperson.
"Dead end"
Meta seeks to expand its operations beyond social networks.
The company is also investing heavily in consumer electronics with smart glasses and is evaluating a new online betting app called Arena, possibly in partnership with Polymarket and Kalshi, according to The New York Times.
However, legal problems threaten to consume time and resources.
In March, a Los Angeles jury found Meta guilty for the first time of the effects of social media addiction, just one day after another conviction in New Mexico for neglecting to protect minors. Meta appealed, but other trials are expected this year.
The company is trying to regain ground in relation to Google, OpenAI and Anthropic, which dominate the race for the most advanced AI models. Meta's models, which have already been postponed several times, have disappointed even within the company.
In an interview with the Financial Times, LeCun, winner of the Turing Prize, the equivalent of the Nobel Prize in IT, considered that Meta's search for "superintelligence" based on large language models (LLM) leads to "a dead end".
Meta lays off 8,000 employees to prioritize spending on AI

Source: G1