Meta explored cutting the size of many teams across the company by as much as 60% in two waves as part of an effort to become "AI native," but reversed course after employee pushback and internal data showing AI agents were ineffective, according to a Reuters investigation published on August 261.
The plan, codenamed Project OT (short for organization transformation), explored scenarios in which Meta reduced some team headcounts by 60% and called for two rounds of layoffs, Reuters reported, citing two people familiar with Meta's internal affairs2. Meta confirmed to Reuters that Project OT explored those reduction scenarios but would not confirm which teams the plan affected.
The initiative was created earlier this year as part of a push to make Meta's workforce "AI native". Staff opposition also played a role in Meta pulling back from the proposed cuts.
ANALYSIS The episode offers one of the most concrete, internally documented cases of a major technology company testing aggressive AI-driven workforce replacement and finding the technology unable to deliver at the scale envisioned.
Meta recently disclosed MTIA 300, its first custom in-house AI training chip with built-in network interface controllers, designed for ranking and recommendation workloads ctx.
ANALYSIS The contrast between Meta's accelerating hardware investment and the failure of Project OT's agent-driven staffing model suggests the company's AI ambitions are being recalibrated toward infrastructure and model development rather than direct labor substitution.
Reuters characterized the investigation as showing the broader challenges organizations face when analyzing the best uses for AI and determining when the technology is a better fit for certain tasks than employees.