Meta Halts Layoffs as Zuckerberg Admits AI Overhaul Errors

Meta Chief Executive Mark Zuckerberg told employees the company has made mistakes in reshaping its workforce around artificial intelligence, according to an internal memo seen by Reuters. He also said Meta does not expect further company-wide layoffs this year.

Given the complexity of these changes, we’ve made mistakes and will almost certainly make more,

Zuckerberg said in the memo. He added that he is focused on providing stability in organizational changes.

Meta laid off roughly 10% of its global workforce in May and shifted 7,000 employees into roles tied to AI workflows. The company’s Applied AI Engineering unit had a flat structure with up to 50 individual contributors for every manager, a ratio that led to concerns about oversight. Zuckerberg said Meta plans to scale back that practice.

Part of the stability effort involves reassigning employees to new AI-model training roles rather than cutting them. “By creating important new roles for people, this also allowed us to shrink the size of teams knowing that if we make mistakes in some places, then we could transfer some people back,” Zuckerberg wrote.

Meta raised its annual capital spending forecast to between $125 billion and $145 billion in April, signaling the company is betting big on AI even as it adjusts the human side of the overhaul. Zuckerberg acknowledged the difficulty of managing such a rapid transition.

The memo also outlined plans to increase team-building budgets and organize a large-scale hackathon in July. Meta declined to comment on the internal message beyond what Zuckerberg wrote.

Meta’s Alpha Score sits at 54 out of 100, a “Mixed” reading that reflects the tension between heavy AI investment and workforce restructuring. The stock traded near $567 on the day, down less than 0.3%.

For anyone tracking Meta, the next concrete markers are the July hackathon results and whether the promised stability holds through the second half of the year. The capex trajectory will also be a key input into the next earnings report.