Meta Prepares for Layoffs as AI Costs Spiral Out of Control
Facebook's parent company Meta is preparing to lay off up to 20% of its workforce. That's roughly 15,000 people out of 70,000 employees about to lose their jobs. And the reason? The same thing that's supposed to be saving the tech industry is actually bleeding it dry. Artificial intelligence.
Meta has spent tens of billions of dollars building AI infrastructure. They're constructing massive data centers in Iowa, Texas, and Indiana filled with Nvidia H100 chips that cost $30,000 each. They're training AI models that require more electricity than some small countries use. Energy costs alone hit $2 billion in 2025.
CEO Mark Zuckerberg bet the company on AI. He's convinced that whoever wins the AI race will dominate the next era of computing. But investors are getting impatient. Meta's stock is down 15% year to date. Morgan Stanley, Goldman Sachs, and Barclays all cut their price targets.
The layoffs aren't just about AI costs though. Meta's core business, advertising, is under pressure too. Competition from TikTok is fierce. ByteDance's revenue in the US grew 40% while Meta's grew just 8%.
Privacy changes by Apple made it harder to target ads, costing Meta an estimated $10 billion annually. And a slowing economy means businesses are cutting their marketing budgets. Procter & Gamble, Unilever, and Coca-Cola all reduced digital ad spending.
This is part of a broader trend. The tech sector has already cut 45,000 jobs in March 2026 alone. Microsoft eliminated positions in Azure and gaming divisions. Google cut 6% of staff. Amazon shut down unprofitable units. Salesforce, Snap, and Spotify all announced reductions.
For Meta employees, this is devastating. Many joined because they believed in the mission or the culture. They bought houses in expensive areas like Menlo Park and Seattle assuming their jobs were stable. Now they're facing layoffs in a job market flooded with other laid off tech workers.
The irony is brutal. AI is supposed to make work easier and more productive. But right now, it's eliminating more jobs than it's creating.
