Meta is considering cutting the metaverse division's budget by 30% next year; stock closes up 3.4%.

On December 5, according to Bloomberg, Meta Platforms will scale back its resource investment in virtual reality projects, even though Mark Zuckerberg had positioned this initiative as the company’s future and rebranded the company from Facebook as a result. Executives are considering budget cuts of up to 30% next year for the metaverse business unit, which includes the virtual world product Meta Horizon Worlds and its Quest virtual reality devices. Such significant cuts could lead to layoffs as early as January next year. Zuckerberg’s metaverse strategy has long been scrutinized by investors, who believe it consumes too many resources, and it has also drawn attention from regulators who accuse the virtual world of infringing on children’s privacy and safety. Wall Street seems pleased with Zuckerberg’s retreat: After the New York market opened, Meta’s stock price surged as much as 5.7%, marking its largest intraday gain since July 31, and closed up 3.4%.