Zuckerberg's "Billion-Dollar Club" Dismantled as AI Team Faces Restructuring and Layoffs

Deep News
Aug 20, 2025

Mark Zuckerberg's aggressive approach continues to intensify. This marks the fourth reorganization of the AI department within six months, accompanied by reports of significant layoffs affecting AI executives and employees.

Cutting to the final result, the entire AI division, Meta Superintelligence Labs (MSL), has now been split into four separate units.

However, the market has not responded favorably to this reorganization. From when news first leaked to the official announcement, Meta Platforms, Inc. stock declined for two consecutive days, dropping 4.29% over the period. While tech stocks broadly declined, Meta Platforms, Inc. temporarily became the worst performer among the "Magnificent Seven" tech giants.

Some analysts believe the frequent adjustments actually demonstrate Zuckerberg's determination. "He's willing to endure short-term pain through rapid iteration to find optimal solutions. In this AI arms race, being slow means losing."

Zuckerberg appears undeterred by market reactions, reshaping the entire company at any cost to stay competitive in the AI race.

**Four-Division Structure with Clear Leadership Hierarchy**

While the new four departments appear parallel, Alexandr Wang seems to hold significant authority and spearheaded this reorganization. The internal memo announcing the restructuring was issued by him as Chief AI Officer, rather than by Zuckerberg himself.

This Scale AI founder was recently recruited by Meta Platforms, Inc. at considerable expense. Zuckerberg praised him as "one of the most impressive founders of this generation," and Wang will directly oversee the TBD lab, focusing on cutting-edge exploratory research. The TBD name stands for "to be determined," suggesting the department's specific direction remains fluid and exploratory.

Working directly with Wang is Zhao Shengjia, a Tsinghua University alumnus poached from OpenAI who serves as Chief AI Scientist for the entire MSL. Sources report that for several consecutive weeks, long lines formed outside his office as Meta employees sought "interviews" to secure positions in the new structure.

Former GitHub CEO Nat Friedman leads the Product and Applied Research division, responsible for transforming sophisticated AI technology into user-friendly products.

The Infrastructure division falls under Engineering VP Aparna Ramani, who previously led PyTorch's transition from Meta Platforms, Inc. to the Linux Foundation.

The FAIR lab, maintaining its decade-long tradition, is now led by Robert Fergus, continuing its focus on long-term fundamental research. Fergus previously worked as a researcher at Meta, later joined Google DeepMind, and was recruited back just months ago.

According to sources, Wang stated in his memo that the new architecture aims to "accelerate" the company's pursuit of so-called superintelligence.

Notable personnel changes include the dissolution of the AGI Foundations Group established in late May, with former leaders Ahmad Al-Dahle and Amir Frenkel now reporting directly to Wang. Al-Dahle led the Llama project and faced criticism over Llama 4 quality issues. Frenkel, originally an Oculus employee who worked on XR AI vision technology for 10 years after the acquisition, became VP of Generative AI in March 2025.

Additionally, former AI Product lead Connor Hayes has been reassigned to manage the social media product Threads.

**Layoffs Hidden Behind Reorganization**

Alongside reorganization news, insiders revealed more details suggesting this adjustment involves more than structural changes. Sources indicate that some AI executives are expected to leave the company following this restructuring.

More surprisingly, Meta Platforms, Inc. is reportedly considering downsizing the entire AI department, potentially including layoffs or transferring employees to other company divisions. However, these discussions remain ongoing, with no final decisions made regarding layoffs.

Some observers question whether future $100 million compensation packages will still be offered if downsizing occurs.

After years of aggressive expansion, Meta's AI department has grown to several thousand employees. Prior to this reorganization, tensions between newcomers and veteran employees had become increasingly apparent.

An anonymous Meta employee revealed: "There's definitely friction between newcomers with massive compensation packages and employees who've worked at the company for years."

Another noteworthy development: Meta Platforms, Inc. is actively exploring the use of third-party AI models to support its products, potentially including other companies' open-source models or licensed proprietary models.

**FAIR's Uncertain Future**

FAIR has faced numerous transitions - relegated to Reality Labs during the metaverse era, moved to GenAI during the generative AI phase, and now becoming one of four departments under MSL in the AGI era. Turing Award winner Yann LeCun has been demoted from the company's Chief Scientist to FAIR's Chief Scientist.

LeCun has not yet responded to the latest reorganization, only showing support for former colleagues' startup ventures on social media.

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