Mark Zuckerberg Cancels Second Wave of AI-Driven Layoffs

CEO Mark Zuckerberg canceled a second wave of planned workforce reductions scheduled for November after a radical restructuring effort, code-named Project OT, failed to meet productivity goals. Conceived during a January leadership retreat in Hawaii, Project OT aimed to transition Meta into an AI-native organization by replacing human workflows with autonomous AI agents, with plans to slash some team sizes by up to 60%.

Meta implemented the first phase of this strategy on May 20, resulting in a 10% workforce reduction. However, internal data revealed that AI agents did not deliver the expected efficiency. Instead, a surge in AI-generated code caused a 40% increase in major technical and security incidents, including a breach of high-profile Instagram accounts. Zuckerberg later conceded that the technology had not accelerated as quickly as anticipated.

Meta confirmed the existence of Project OT and the exploration of 60% team reductions but clarified that it never intended to cut 60% of its total workforce, noting that thousands of employees were redeployed. Despite the pullback on layoffs following an employee revolt, the company continues to invest heavily in AI infrastructure, with planned spending of at least $130 billion in 2026.