The initiative, code-named "Project OT," for Organization Transformation, envisioned turning Meta into an "AI native" company. #
Mark Zuckerberg entered 2026 with an ambitious plan to remake Meta around artificial intelligence, potentially eliminating or reassigning thousands of jobs as AI agents took over work once performed by employees. Within months, however, the strategy was encountering employee resistance, security problems, and evidence that the technology was not delivering the productivity gains executives had expected.
A Reuters special report, based on scores of internal documents, recordings and interviews with more than 20 people familiar with the company's operations, revealed that Zuckerberg and his leadership team developed the initiative during a January retreat at his Hawaii compound.
The initiative, code-named "Project OT," for Organization Transformation, envisioned turning the Facebook and Instagram parent into an "AI native" company. Under the most aggressive scenarios considered by executives, some Meta teams could shrink by up to 60%, with AI handling more daily tasks and smaller groups of highly productive employees overseeing the work.
Meta stressed to Reuters that the 60% figure applied only to scenarios involving certain teams and was never a plan to eliminate 60% of the company's overall workforce. Project OT was expected to unfold in two waves.
The first would take place in May and the second in November. Layoffs would be combined with eliminating open positions, redeploying workers, and removing employees considered poor performers.
But hours before the first round of layoffs on May 20, Zuckerberg abandoned plans for the second company-wide wave. Meta proceeded with a 10% workforce reduction, but Zuckerberg subsequently told remaining employees that he did "not expect other company-wide layoffs this year."
The reversal came as Meta's AI experiment was producing troubling internal results. Employees were generating far more code with AI tools, but that surge was not translating proportionally into products reaching users.
Internal data cited by the outlet showed code changes to Meta's software platforms and infrastructure increased 220% year over year, while changes resulting in new or upgraded user-facing features rose just 36%.
More concerning were reliability and security problems. Internal posts warned that AI agents were taking disruptive actions humans were unlikely to perform. Major technical and security incidents, including outages and possible data leaks, increased 40% from the previous year, while the amount of time employees spent responding to those problems jumped 70%.
Employee morale was also deteriorating. Workers became increasingly convinced they were being asked to train the systems that could eventually replace them, particularly after Meta required tracking software on U.S. employees' computers to record keystrokes and mouse movements for AI training.
Meta's internal employee sentiment score subsequently fell from 74% favorable to 55%, according to its half-year Pulse survey cited by Reuters. Employees protested internally with angry posts, jokes and images of elephants meant to symbolize layoffs as the "elephant in the room." Meta eventually d the tracking initiative and allowed some engineers who had been transferred into new AI-focused positions to return to their previous teams.
The company's original vision went well beyond simply giving workers AI assistants. An internal "AI-Native Playbook" described replacing traditional product-development teams of 10 to 20 specialists with pods of roughly three to five people. Conventional titles could disappear in favor of a more flexible "builder" role, while layers of middle management would be removed.
Meta was simultaneously identifying what it called "Irreplaceable Talent," including hypothetical "10X Performers" capable of producing the output of much larger teams with help from AI. By July, however, Zuckerberg publicly acknowledged that a central assumption behind the overhaul had not materialized on schedule. AI agent development, he said, had not "accelerated" as quickly as anticipated.
Zuckerberg has also shifted his public message toward AI as a technology that empowers workers rather than simply replaces them. In his essay "The Future is for Everyone," he predicted an "abundance of jobs" while acknowledging that individual companies could ultimately employ fewer people.
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