Meta Metaverse Layoffs 2026: Inside the $73 Billion Reality Labs Meltdown!

Meta just hit a breaking point in its metaverse dream. After racking up nearly $73 billion in cumulative losses since 2021 through its Reality Labs division, the tech giant is finally hitting pause. The most recent gut check? A $4.43 billion operating loss in Q3 2025, disappointing Quest headset shipments (down 16% year-over-year), and a major workforce cut that affects over 1,000 employees. All signs point to a company scaling back ambitions and resetting expectations. While CEO Mark Zuckerberg still touts AR glasses and AI as long-term bets, the stark financials and cooling consumer demand for the metaverse are forcing a shift. From Google Trends showing a collapse in metaverse interest to YouGov surveys revealing Americans aren’t biting, the market simply isn’t there yet. This reset matters not just for Reality Labs, but also for Meta’s cost discipline, capital allocation, and its broader stock narrative. So what’s next? Let’s unpack the key drivers.