Meta will lay off approximately 8,000 employees, about 10 percent of its workforce, effective 20 May. The company is also scrapping plans to fill 6,000 open positions.

The cuts are the largest at Meta since 2023, when the company eliminated 21,000 roles during its “year of efficiency.” Why it matters: Meta’s decision to shed workers while nearly doubling infrastructure spending to $115-135 billion crystallises the trade-off the entire tech industry is making, replacing human roles with AI capacity at unprecedented scale.

The numbers

Meta spent $72.2 billion on capital expenditure in 2025, primarily on data centres and AI infrastructure. The company projects that figure will climb to between $115 billion and $135 billion in 2026, driven by its Superintelligence Labs division and core business operations.

A $27 billion joint venture with Nebius will build a gigawatt-scale AI data centre campus in Louisiana. The facility will support Meta’s Llama language models and recommendation systems.

Severance terms

Affected US employees will receive 16 weeks of base pay plus two additional weeks for each year of service. International severance packages will follow similar structures. The company said it will provide career transition support and extended healthcare coverage.

Industry pattern

Meta is not alone. The tech sector has recorded more than 73,000 job cuts across 95 companies in the first four months of 2026, according to industry tracking data. Projections suggest the full-year total will exceed the 124,200 positions eliminated in all of 2025.

CEO Mark Zuckerberg had signalled the shift at the start of 2026, calling it “the year that AI starts to dramatically change the way that we work.” An earlier round of cuts in March affected hundreds of employees across Facebook, Reality Labs, global operations, and sales.

What it means for AI

The spending surge reflects a broader conviction among tech executives that the companies with the most computing power will dominate the AI era. Meta’s investments fund training runs for its open-source Llama models, which compete with OpenAI’s GPT series and Google’s Gemini.

The question for investors is whether $115-135 billion in annual capital spending can generate returns quickly enough to justify the workforce cost. Meta’s stock rose 2 percent in after-hours trading following the announcement.