Provided by Dow Jones
By Mike Murphy
Meta's corporate headquarters in Menlo Park, Calif.
After a months-long hiring spree, Meta Platforms Inc. has frozen hiring in its artificial-intelligence division, according to a new report.
The Wall Street Journal reported Wednesday night that the hiring freeze went into effect last week and is part of a broader restructuring. That shakeup - the fourth in six months - was first reported by The Information last week and will reportedly split Meta's AI division into four units: one for superintelligence, one for consumer products, one for AI infrastructure and one for long-term projects and research.
In an email Wednesday night, a Meta spokesperson downplayed the freeze as "basic organizational planning: creating a solid structure for our new superintelligence efforts after bringing people on board and undertaking yearly budgeting and planning exercises."
The restructuring and hiring freeze come after an aggressive spending spree for AI talent, in which Meta (META) has hired more than 50 AI researchers and engineers, according to the Journal. Wired had previously reported that Meta was offering pay packages worth up to $300 million to poach some top-level researchers from rival OpenAI, though Meta denied details of that report.
Last month, Meta blew away its quarterly earnings expectations, sending its stock to a record high even as it added $17 billion in capital expenditures during the second quarter. In April, Meta raised its capex outlook to as much as $72 billion for the year.
But some investors are starting to worry about the spiraling costs of AI, as tech companies like Meta sink billions into research and infrastructure, including data centers. OpenAI Chief Executive Sam Altman recently admitted there's an AI bubble, agreeing with the contention that investors are "overexcited" about AI.
Those concerns have contributed to a recent pullback by the tech-heavy Nasdaq Composite COMP, which has retreated 2.5% over the past five days, and has gained less than 1% over the past month. Meta stock has fallen about 4% over the past week and AI chipmaker Nvidia Corp. (NVDA) has declined 3.4%, while shares of AI darling Palantir Technologies Inc. (PLTR) have tumbled 16% during a six-session losing streak.
Read more: As Nasdaq stumbles again, investors start to wonder: Have Big Tech stocks finally peaked?
Still, Meta shares are up about 28% year to date, and tech industry bulls like Wedbush Securities analyst Dan Ives still have high hopes.
Despite recent pressure, "this is still only the bottom of the 2nd inning in the 9 inning game around building out the AI Revolution over the coming years," Ives said in a Wednesday note. "We view tech selloffs like yesterday as opportunities to own the core winners... In our view the tech bull cycle will be well intact at least for another 2-3 years."
-Mike Murphy
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08-20-25 2303ET
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