Meta stock climbed about 3% on Monday, following what it called "speculative" reports that the company is planning to lay off over 20% of its workforce to balance its big artificial intelligence spending plans this year.
Reuters reported on Saturday that top executives at the tech giant told senior leaders to start making plans to reduce headcount, citing three anonymous sources familiar with the matter. The company's shares fell nearly 4% on Friday.
When asked whether Reuters' reporting was accurate, a Meta spokesperson told CNBC: "This is a speculative report about theoretical approaches."
Meta employed nearly 79,000 employees as of December 2025, and the magnitude of the layoff described could affect more than 15,000 workers. This would be its largest layoff since late 2022, when CEO Mark Zuckerberg said Meta was cutting 11,000 jobs and paring back hiring as part of an expansive cost-trimming strategy.
Further potential Meta job cuts come as the tech giant doubles down on building out expensive AI infrastructure and reaping efficiency gains from AI integrated into its workflows.
Several firms have already revealed major redundancy plans linked to AI in 2026. Jack Dorsey's Block said it's laying off 4,000 employees in February to enable the firm "to move faster with smaller, highly talented teams using AI to automate more work."
Meanwhile, Amazon eliminated 16,000 roles in January in an effort to reduce layers and bureaucracy, amid plans to invest heavily in AI.
Software firm Atlassian said Wednesday it's cutting 10% of its workforce, or 1,600 employees, on plans to direct investments into AI.
So far in 2026, AI has been cited in over 12,000 job cuts in the U.S., according to the latest data from consulting firm Challenger Gray & Christmas.
AI spending to reach $135 billion
Meta revealed in its fourth-quarter earnings reports in January that its AI-related capital expenditure will be in the range of $115 billion and $135 billion this year, roughly double the amount it spent in 2025 in efforts to build its new AI unit.
This is part of a combined $700 billion that tech hyperscalers, including Amazon, Alphabet, and Microsoft, are planning to invest in AI this year.
The plans have raised concerns among some investors about potentially unsustainable spending when compared with the amount of revenue being generated by AI.
Zuckerberg said that 2026 will be a major year for AI as the company's investment focuses on his mission for "building personal super intelligence."
Last year, the company invested $14.3 billion in Scale AI. Meta ultimately poached the group's CEO, Alexandr Wang, and some of his top engineers and researchers.
"While we have seen significant layoffs at companies like Block who laid off 40% of headcount 'due to AI', if Meta is willing to reduce headcount at this scale while ramping AI investment, we think it signals a broader shift: AI is increasingly driving productivity," Jefferies' analysts said in a note on Sunday.
"That has important implications not just for Meta, but across the broader internet/software landscape as investors revisit the link between headcount, growth, and margins...these cuts are clearly being considered in part to offset rising AI infrastructure costs with significant AI-driven capex ramp," they added.
Correction: This story was updated to reflect that Meta's shares were down on Friday. A previous version said they fell on Sunday.
