Meta reduces its workforce by 8,000 employees while reporting a record quarterly revenue of $56 billion, as Zuckerberg invests $145 billion in AI infrastructure.
**TL;DR** Meta will start reducing its workforce by 8,000 positions on May 20 while announcing record quarterly earnings of $56.31 billion, as it ramps up investment in AI infrastructure, projecting up to $145 billion by 2026. Employee morale has severely dropped, with internal protests regarding surveillance software, diminishing pay, and expectations of additional layoffs into the fall.
Meta plans to cut about 8,000 jobs beginning on May 20, marking the most significant layoffs since its 2023 restructuring, highlighting CEO Mark Zuckerberg’s commitment to prioritizing AI infrastructure over the workforce. Additionally, the company will cancel 6,000 open job positions, resulting in a total reduction of 14,000 roles.
These layoffs come during a period of impressive financial success, with Meta reporting a first-quarter revenue of $56.31 billion and a net income of $26.8 billion. The total revenue for 2025 reached $201 billion, reflecting a 22% increase year-over-year, and the free cash flow stood at $43.6 billion. The company is not shrinking due to financial struggles but has opted to shift its focus from human capital to AI infrastructure, undertaking measures that no other tech firm has pursued to this extent.
**The financial strategy**
Meta has adjusted its 2026 capital expenditure forecast to between $125 billion and $145 billion, a steep rise from $72.2 billion in 2025 and $39.2 billion in 2024. Most of this increase allocates funds to data centers, Nvidia GPUs, custom silicon, and infrastructure supporting its Llama model ecosystem and recommendation systems. In the first quarter alone, Meta secured $107 billion in new contracts for cloud and infrastructure initiatives, with an additional $27 billion committed to a joint venture with Nebius for a large-scale AI data center in Louisiana.
Bank of America estimates that the layoffs could save between $7 billion and $8 billion annually, a small portion of the capital expenditure plan but a significant contribution to the operating margin that CFO Susan Li aims to maintain. Li indicated to investors during the Q1 earnings call that a leaner operating model would enable quicker company responses while alleviating infrastructure expenses. She also admitted that the executives “don’t really know what the optimal size of the company will be in the future,” an unusual statement coming from a CFO whose firm is reporting record profits.
The financial situation is stark: Meta is spending more on AI infrastructure in a single year than many Fortune 500 companies earn in total annual revenue, and part of this funding comes from the layoffs of employees who helped build the business generating that revenue.
**What’s happening within the company**
While the financial justifications behind the restructuring are sound, the human impact is less clear. Meta posted record quarterly results just weeks before the impending layoffs, creating a sense of corporate dissonance that employees and industry observers have noted as corrosive.
Zuckerberg held a company-wide town hall on April 30 to address the layoffs. He was clear that AI tools were not responsible for the job losses, stating, “Getting everyone internally to use AI tools and getting to do the work more efficiently is not the thing that’s driving layoffs.” However, he did not clarify the reasons behind the layoffs, increasing anxiety among employees.
At the same time, Meta has been reducing compensation for most employees while significantly increasing it for AI researchers. Median total compensation at Meta dropped from $417,400 in 2024 to $388,200 in 2025. Furthermore, the stock portion of annual raises was reduced by 5% in February 2026, following a 10% reduction the previous year. Meanwhile, Zuckerberg has been actively recruiting AI researchers with compensation packages reportedly reaching $100 million for the new Meta Superintelligence Labs, led by former Scale AI CEO Alexandr Wang.
The disparity between dwindling pay for the majority of employees and exorbitant packages for a select few has led to a culture of resignation. Employees have established at least three countdown websites marking the days until May 20, one of which is labeled “Big Beautiful Layoff.” According to data from Blind, an anonymous professional network requiring work email verification, Meta’s overall employee rating has decreased by 25% since its peak in the second quarter of 2024, along with a 39% drop in its culture rating. With the exception of compensation, Meta now lags behind Amazon, Google, and Netflix in every rating category.
**The surveillance issue**
Adding to the discontent is an initiative called the Model Capability Initiative, which Meta implemented on the laptops of U.S. employees in April. The software tracks mouse movements, clicks, keystrokes, and screenshots across specific work applications. Meta claims the data collected is meant to educate AI systems on human software navigation, not for general surveillance purposes. Employees in several U.S. offices have protested by distributing flyers labeling the program an “Employee Data Extraction
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Meta reduces its workforce by 8,000 employees while reporting a record quarterly revenue of $56 billion, as Zuckerberg invests $145 billion in AI infrastructure.
Employee morale has plummeted as Meta announces record profits while cutting 10 percent of its workforce. Additional layoffs are anticipated in August and fall 2026, as the company shifts payroll expenses towards AI capital investments.