What you need to know
- Meta is reportedly cutting 10% of Reality Labs employees, which equates to approximately 1,500 jobs lost.
- One report suggests the cuts only affect VR hardware, OS development, and Horizon Worlds development, but additional sources claim Meta is closing four of its internal game development studios.
- Meta hasn’t publicly commented on the moves, but the company is reportedly holding a big meeting on January 14, 2026, to discuss the changes.
Meta is reportedly laying off 10% of its Reality Labs division, cutting roughly 1,500 jobs. Reality Labs has been responsible for AR, VR, AI, and robotics development since its creation in 2020 and has historically spent billions on R&D each quarter.
Earlier reports suggested that Meta was “trimming the fat” in the VR hardware research, OS development, and Horizon Worlds gaming social network development. However, new information suggests that the cuts are far deeper than we expected.
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Meta is reportedly closing most of its first-party game development studios, including the houses responsible for respected VR games like Deadpool VR, Asgard’s Wrath 2, Supernatural, and Resident Evil 4 VR. The studios rumored to be closing are Armature Studios, Sanzaru Games, Twisted Pixel, and Within. LinkedIn profiles confirm job cuts at all of these studios, but
Meta is said to be keeping Beat Games, BigBox VR, Camouflaj, and Ouro open. These studios are responsible for the development of Beat Saber, Population: One, Batman Arkham Shadow, and Horizon Worlds, respectively. UploadVR says it has independently confirmed the studio closures.
(Image credit: @Lunayian on X)
Android Central has reached out to Meta for comment, but didn’t receive a response in time for publishing. If true, this news would be a massive blow for the VR community and a huge hit to VR game development.
To date, Meta has closed several of its first-party studios over the years. We reported exclusively on the closing of Echo VR’s studio back in August 2024, and Meta closed Unit 2 and Downpour Interactive in 2025. These cuts come after a 30% cut to the division in early December 2025, despite outselling the Nintendo Switch 2 and other consoles on Amazon during the Christmas holiday period.
Meta CTO Andrew Bosworth is expected to hold a company-wide in-person meeting on January 14, 2026, to discuss changes being made at Reality Labs. The company is believed to be shifting more resources to AI and smart glasses products in place of its historical commitment to VR development. We still expect Meta to debut a new product early in 2027 that’s a hybrid of smart glasses and a traditional VR headset, currently known as Project Phoenix, pictured above in a mock-up.
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