Meta Platforms has reportedly paused hiring across its high-profile artificial intelligence division as concerns rise over surging costs tied to the unit. The move comes amid a broader restructuring and follows months of aggressive recruitment to build out the company’s AI efforts.
Hiring pause and internal controls
According to Investopedia, which cites reporting by the Wall Street Journal, Meta began the hiring freeze last week and set stricter approval requirements for exceptions. The report said that any exceptions would require sign-off from chief AI officer Alexandr Wang.
The AI division comprises four teams and has already added more than 50 engineers and researchers, the report said. It also noted that Meta “prohibits current employees from moving across teams inside the division,” signaling tighter internal controls during the restructuring.
Aggressive recruiting and investor concerns
Investopedia reported that Meta has been among the most aggressive in the sector at recruiting AI talent, including offering nine-figure pay packages and using so-called “reverse acquihires,” in which the company buys into a startup to gain its leaders. The report highlighted Meta’s investment in Scale AI as an example of that approach.
Leadership and market reaction
Meta hired Scale AI CEO Wang in June to lead an AI “superintelligence group,” underscoring the strategic importance the company has placed on advanced AI development. Even so, the Journal said some analysts worry that stock-based compensation costs could threaten shareholder returns.
Investopedia added that Meta did not immediately respond to its request for comment. The article noted that Meta shares, which had been up 28% this year as of Thursday, were down 1% in early trading following the report.
According to The Wall Street Journal, the hiring freeze follows a “blockbuster spending spree” in AI, and reflects growing investor scrutiny of the costs associated with building out the company’s AI capabilities.
