Archive · 27 Aug 2026
Meta Shelves Second AI Restructuring Wave After Employee Pushback
Meta created a plan called Project OT to use artificial intelligence in more of its work.
The plan imagined virtual workers doing many tasks while smaller groups of people supervised them.
Some individual teams could have become up to 60 percent smaller.
The plan included layoffs, moving employees to new jobs and closing unfilled positions.
Meta carried out a 10 percent workforce reduction in May 2026.
However, Mark Zuckerberg canceled a second restructuring wave planned for November.
Employees worried that the AI systems they were helping build might replace them.
Company data showed much more computer code was being produced, but far fewer new user features were created.
Zuckerberg later said AI agents had not improved as quickly as expected and promised employees more stability.
Meta’s Project OT explored shrinking some teams by up to 60% through layoffs, redeployments and vacant-role closures.
The AI-native restructuring was planned in two waves, but Zuckerberg canceled the November phase before Meta’s May cuts.
Meta reduced its workforce by 10% on May 20, while saying it never intended to cut 60% of all employees.
Employee sentiment fell from 74% to 55% favorable as workers feared they were training systems that could replace them.
Internal data showed infrastructure changes up 220%, but user-facing feature changes rose 36% and major incidents increased 40%.
- Who
- Meta, Chief Executive Officer Mark Zuckerberg, senior executives and Meta employees.
- What
- Meta explored an AI-focused restructuring that could reduce some teams by up to 60%, then canceled the planned second wave.
- When
- Project OT was developed in January 2026; Meta carried out a 10% workforce reduction on May 20 and canceled the November phase beforehand.
- Where
- The plan was developed during Meta’s leadership retreat at Zuckerberg’s Hawaii compound and affected teams across the company.
- Why
- Meta said it wanted to reduce costs, redesign teams and move employees into priority areas, including AI training-data work.
Meta’s Rationale
Employee and Investor Concerns
Purpose of the overhaul
Meta’s Rationale
Meta described Project OT as a year-long effort to cut costs, redesign teams and move thousands of employees into priority work, including producing AI training data.
Employee and Investor Concerns
Employees feared the transformation was partly intended to replace their jobs, while some investors questioned the results of Meta’s large AI spending.
Scale of potential cuts
Meta’s Rationale
Meta said the 60% figure applied only to certain team-level scenarios and included redeployments and open-role closures; it never intended to cut 60% of its overall workforce.
Employee and Investor Concerns
Internal planning documents and sources described a possible restructuring comparable to or larger than Meta’s earlier workforce reduction of about 25%.
AI productivity
Meta’s Rationale
Meta said small teams, AI tools and redeployments supported priority work, and that data from its Applied AI Engineering unit helped train an AI model released in July.
Employee and Investor Concerns
Internal figures showed code and infrastructure changes rising much faster than user-facing features, alongside increases in technical incidents and time spent resolving problems.
- Initiative
- Project OT, short for Organization Transformation
- Potential team reductions
- Up to 60% in some teams through layoffs, redeployments and open-role closures
- Completed workforce reduction
- 10% on May 20, 2026
- Canceled restructuring
- Second wave planned for November 2026
- Employee sentiment
- Half-year Pulse survey favorability reportedly fell from 74% to 55%
- AI productivity indicators
- Internal software-platform and infrastructure changes rose 220%, while user-facing feature changes rose 36%
- Planned AI investment
- At least $130 billion on AI chips and infrastructure in 2026, according to LSEG estimates cited in the reports
Sources
Mark Zuckerberg Wanted AI to Shrink Meta's Workforce by 60%
Mark Zuckerberg wanted AI to transform Meta’s workforce. Here’s how the plan fell apart - Telegraph India
Zuckerberg had SECRET AI plan for Meta: 60% cuts, ‘virtual workers’. But then something went wrong
Meta Explored Upto 60 Per Cent Team Cuts In AI Overhaul Before Zuckerberg Pulled Back: Report