Meta Plans 20% Layoffs To Divert Capital To Data Centers

On Friday we noted that Meta has delayed the rollout of its latest AI model because it sucks - and may temporarily license superior models like Gemini to power the company’s AI products. 

Now, Meta is reportedly mulling a massive new round of layoffs that could affect more than 20% of its workforce as it accelerates spending on AI data center buildouts. The move comes as other hyperscalers consider similar workforce restructurings to redirect capital flows toward AI infrastructure.

Reuters cited people familiar with the plans and said no final decision or timeline has been set for the restructuring. The report added that senior leaders have already been told to begin planning cuts.

Top executives have recently signaled the plans to other senior leaders at Meta and told them to begin planning how to pare back, two of the people said. The sources spoke anonymously because they were not authorized to disclose the cuts. -RTRS

The latest Bloomberg data show Meta’s total workforce at the end of 2025 was about 79,000, meaning a 20% reduction would amount to nearly 16,000 workers. Meta CEO Mark Zuckerberg has already been downsizing the workforce since the 2022-23 “year of efficiency” layoffs.

“This is speculative reporting about theoretical approaches,” Meta spokesperson Andy Stone told the outlet.

Meta’s labor restructuring suggests the insane Covid-era hiring binge is being aggressively unwound. The company cut 11,000 workers in November 2022, or about 13% of its workforce, and it would not be surprising if more cuts are still to come.

Meta plans to spend $600 billion on data centers by 2028 and recently announced it had acquired Moltbook, a social networking platform built for AI agents. Meta is also acquiring Chinese AI startup Manus for $2 billion.

Earlier this month, Bloomberg reported that Oracle was planning to lay off thousands of workers as it spends aggressively on AI data center buildouts. Amazon confirmed in January that it would cut 16,000 jobs, while Block slashed its workforce by half last month.

Let’s not forget this 2023 Goldman note…

so yeah, time to reread this from March 2023:
AI Will Lead To 300 Million Layoffs In The US And Europe https://t.co/iav1uCy07u pic.twitter.com/y5WjW2sPao

— zerohedge (@zerohedge) February 23, 2026

Last week, Palantir CEO Alex Karp delivered an apocalyptic warning to progressives, particularly “highly educated, often female voters, who vote mostly Democrat,” stating that their influence over the economy and broader society will erode as technologies such as AI transfer power to working-class, right-leaning men.

We expect that, in the era of AI, much of the Covid hiring across big tech will be unwound. Those coders will be back to bartending.