Has the Metaverse Suffered a Defeat? Meta Prepares to Cut Budget

Metaverse Planet

December 15, 2025

Meta management is preparing to reduce the budget prepared for the metaverse project. It has been reported that Meta may cut the budget allocated for metaverse projects by up to thirty percent next year. According to news based on Bloomberg‘s sources, potential cuts are not yet finalized but are expected to affect the unit working on Quest virtual reality headsets and the social platform Horizon Worlds.

Metaverse Investments Are Decreasing The company, which changed its name from Facebook to Meta and built its vision on virtual worlds, has spent billions of dollars on the goal of building the metaverse in the last few years. However, CEO Mark Zuckerberg shifted the focus to developing Artificial Intelligence (AI) superintelligence. The company made high-level hires for this purpose; most recently, it added former Apple user interface designer Alan Dye to its team to oversee the design of AI integration for hardware, software, and interfaces.

Bloomberg reported that Zuckerberg asked Meta executives to “look for cuts of generally ten percent” as part of the annual budget planning process. However, it was reported that Zuckerberg demanded more spending cuts from the metaverse unit under the umbrella of Reality Labs, on the grounds that he did not see the industry-wide competition Meta expected.

It is also among the incoming information that Meta may start laying off metaverse employees as early as January as part of these potential cuts. Meta spokesperson Nissa Anklesaria used a statement confirming the situation in a statement to The New York Times: “Across our general Reality Labs portfolio, we are shifting some of our investment from the Metaverse to AI glasses and wearable devices because it has gained momentum. We are not planning any changes more comprehensive than this.”

According to Bloomberg‘s report, Meta’s metaverse-focused unit Reality Labs has lost over $70 billion since the beginning of 2021, and the company’s latest earnings reports show that this unit continues to lose cash.

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