‘I’ve made the decision to restructure several parts of the GenAI organization. I believe these changes will best position us for the long-term, make the org more efficient, and allow GenAI to focus on the biggest and most profitable opportunities,’ wrote Scale AI’s interim CEO in a Wednesday email to employees.
The fallout from a massive investment by Facebook parent company Meta in Scale AI appears to be starting as Scale AI moves to cut about 14 percent of its workforce.
Business Insider Wednesday reported that San Francisco-based Scale AI has laid off about 200 of its full-time employees and about 500 contractors, citing company sources.
The move comes just one month after Meta unveiled a plan to invest $14.8 billion in Scale AI, giving Meta a 49 percent stake in the company. That investment valued Scale AI at over $29 billion.
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With that investment, Meta also brought in Scale AI’s founder and CEO at the time, Alexandr Wang, to become Meta’s new chief AI officer. Wang is also spearheading Meta’s new “Superintelligence” initiative.
Replacing Wang as interim CEO was Jason Droege, who had served as chief strategy officer since joining the company in August of 2024.
Scale AI had a full-time workforce of about 1,400 people, Business Insider reported. The 200-person layoff represents a cut of about 14 percent.
Business Insider reported the layoffs were abrupt, with impacted employees shut out of the company’s systems early in the morning.
Scale AI did not respond to a CRN request for further information by press time.
The layoff comes as Google and other large clients have halted projects they had with Scale AI after the Meta investment, as well as questions around training document security practices, Business Insider reported.
In an email to Scale AI employees published by multiple news outlets, Droege said the layoffs come from a restructuring aimed at a focus on GenAI.
“I’ve made the decision to restructure several parts of the GenAI organization. I believe these changes will best position us for the long-term, make the org more efficient, and allow GenAI to focus on the biggest and most profitable opportunities,” Droege wrote.
