Meta reportedly abandoned an AI-focused restructuring plan that would have laid off thousands of employees. The plan, dubbed Project OT, aimed to use AI to take over many of the workforce’s daily tasks, with AI agents overseen by smaller “pods” of human employees.
According to the report, Meta executives were influenced by startups that had structured themselves around AI, and they laid out an “AI native” vision for the company at an annual leadership retreat in January.
Under Project OT, engineers, designers, product managers, and other specialists would transition into general-purpose “builder” roles, and middle-management layers would shrink. The plan also included “agent-assisted analysis” to help determine day-to-day priorities.
Executives considered reducing some teams’ headcounts by as much as 60 percent, with layoffs making up part of the reduction, along with eliminating open positions and pushing out workers the company saw as lower performers.
One HR executive projected the reduction to be at least as large as the company’s 2023 cuts, which shaved 25 percent off its workforce.
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CEO Mark Zuckerberg ultimately abandoned, or at least paused, the plan’s second wave of layoffs, which was initially set to occur in November.
One reason for the change of heart may have been that Meta’s internal AI push wasn’t going as planned. While the company’s data showed a significant increase in code changes to its AI software platforms and infrastructure, this didn’t translate into equally dramatic productivity gains.
New or improved features that actually reached users rose just 36 percent, and advancements in those areas were offset elsewhere, as the number of technical and security incidents rose 40 percent.
The time employees spent on those problems grew by 70 percent. In July, Zuckerberg appeared at a company town hall and admitted that he overestimated how quickly the technology would advance.
Zuckerberg stated that the “trajectory of the agentic development over at least the last four months hasn’t really accelerated in the way that we expected.”
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The company’s decision to track employees’ mouse movements and keystrokes to train their eventual AI agent replacements also sparked backlash, with complaints flooding Meta’s internal communication network and employee-sentiment scores falling by 19 points.
While Meta hasn’t necessarily abandoned the broader plan, Zuckerberg’s messaging about further layoffs only reassured employees that further “company-wide” cuts wouldn’t happen “this year,” sparking internal fears about smaller reductions this year or broader ones in 2027.
Smaller AI-assisted teams remain in use in parts of the company, and Meta is spending heavily on AI infrastructure, with investors wondering when those investments will bear fruit.
Zuckerberg will be under pressure to show tangible gains tied to the company’s AI efforts.
The fate of Project OT and its associated layoffs remains uncertain, with the company’s restructuring efforts likely to be closely watched by investors and employees alike.