Meta Platforms Inc (NASDAQ:META) is reshaping its artificial intelligence strategy with sweeping leadership changes, escalating investments and a decisive shift away from its open-source roots.
CEO Mark Zuckerberg — who only a year ago pushed Meta's Llama models as the future of open-source AI — has pivoted sharply. Llama received almost no mention during the company's October earnings call, signaling a retreat after the underperformance of Llama 4 and rising competition from Chinese labs such as DeepSeek.
CNBC reported Tuesday that Meta is developing a new frontier model codenamed Avocado. Initially planned for late 2025, the launch has been pushed to early 2026 due to training performance issues. Unlike previous models, Avocado may debut as a proprietary system, marking a dramatic philosophical reversal for the company.
Benzinga reached out to Meta investor relations for its take on the report and is awaiting a response.
The shift has triggered major internal upheaval. Zuckerberg removed longtime Chief Product Officer Chris Cox from Meta's AI division, replacing him with 28-year-old Scale AI founder Alexandr Wang, now serving as chief AI officer. Wang — working closely with former GitHub CEO Nat Friedman — leads elite fast-moving units that operate with startup-like secrecy.
This break from Meta's historically open culture has created friction inside the organization. The new AI leadership enforces a rapid "demo, don't memo" style that leans heavily on modern AI agents, pushing employees through 70-hour workweeks amid ongoing layoffs and restructuring.
The cultural transformation culminated in Chief AI Scientist Yann LeCun's departure to launch his own startup.
Wall Street is watching closely as Meta pours billions into accelerating its AI race. Meta spent $14.3 billion to acquire Wang's team and raised its 2025 capex outlook to more than $70 billion, prompting investor debate about whether the massive bet can deliver returns.
Meta Reshapes Hardware Strategy With Limitless Buy, Cloud Deals and Metaverse Cuts
As Meta intensifies its artificial intelligence ambitions, the company is simultaneously restructuring its hardware and infrastructure roadmap, reallocating capital and tightening focus around AI-driven devices.
Meta recently acquired Limitless, a startup known for AI-powered wearable technology, to speed up its push toward what Zuckerberg calls "personal superintelligence." The company is integrating Limitless' device expertise with Meta's consumer scale and AI infrastructure.
As part of the transition, Meta is ending commercial sales of the Limitless Pendant while supporting existing users for at least a year, eliminating subscription fees and providing free access to premium features. The company is also retiring non-core apps such as Rewind, reducing its regional footprint, and adding tools that help users manage, export or delete their data.
At the infrastructure level, Meta is diversifying beyond its own data centers. The company has struck cloud partnerships with CoreWeave Inc (NASDAQ:CRWV) and Oracle Corp (NYSE:ORCL) while simultaneously building its massive Hyperion facility in Louisiana — all to support next-generation AI workloads.
To free up capital, Meta is cutting up to 30% of its 2026 metaverse budget. That includes delaying its Phoenix mixed-reality glasses to early 2027 and shifting more resources into higher-quality smart glasses, AI wearables and data center expansions.
Analysts at JPMorgan and Bank of America Securities say the tighter spending discipline and reprioritization could free billions in cash flow and help support earnings growth as Meta doubles down on AI-driven products and infrastructure.
Meta shares are up 12% year-to-date as investors weigh the balance between soaring capital expenditures and long-term AI ambitions.
META Price Action: Meta Platforms shares were down 1.16% at $659.08 on Tuesday at publication, according to Benzinga Pro data.
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