- Meta is reorganizing Reality Labs to make it a business priority, a leaked memo shows.
- The reorganization follows major changes at the company including coming performance-based cuts.
- Reality Labs faces scrutiny for racking up losses; Meta sees it as a strategic long-term priority.
Meta is shaking up Reality Labs and integrating it more closely with its core business.
Chief technology officer Andrew Bosworth announced a series of reorgs in a post on Meta's internal forum Workplace, which Business Insider viewed.
Bosworth said Reality Labs has "become a positive driver for Meta's overall brand", which has sparked the reshuffle.
As part of the changes, Brent Harris, VP of Meta's wearables business group, and Brett Vogel, the company's VP of product marketing and Metaverse, and the product marketing team will now work under the team of Meta's Chief Marketing Officer, Alex Shultz.
Colan Sewell, VP and chief revenue officer of Reality Labs, along with its sales employees, will now report to Meta's head of partnerships and business development, Justin Osofsky.
Alessio Sanfilippo, VP of analytics in Reality Labs, will report directly to Bosworth.
"Keeping those functions integrated with Reality Labs makes a lot less sense when our products are now such a major driver of overall company brand and sentiment," Bosworth wrote.
He added, "With the rebrand to Meta and a much more integrated vision of the future, especially with AI, the inverse is also true as we depend a great deal on the rest of the company. Now that the industry has their eyes set on the categories we've defined, we'll need to tap into Meta's full power to win what comes next."
Meta previously reorganized some of its major units in October and cut roles at Reality Labs, Instagram, and WhatsApp. Last June The Verge reported that the company separated the division into two organizations, Wearables and Metaverse. As part of the restructuring, a small number of people were laid off.
Meta didn't immediately respond to a request for comment from BI.
Meta's Reality Labs division is under increasing scrutiny as it continues to incur substantial losses and significant investments in the unit. Since 2020, Meta has recorded losses of more than $58 billion.
In the company's most recent earnings call, Chief Financial Officer Susan Li said the Reality Labs is a "strategic long-term priority."
Meta also warned investors it anticipated the division's operating losses to "increase meaningfully year-over-year" in 2024 as a result of costs related to scaling and product development.
The latest reorg comes as Meta is set to report its fourth-quarter earnings on Wednesday.
Read the full memo Bosworth shared on Workplace:
What's next for RLBG
TLDR: Today we're announcing that the Go To Market teams in the RL Business Group (RLBG) will move to Javi's central Cross-Meta Foundations (XF) team. RLBG's Analytics and UXR teams will remain in the org as RL Insights led by Alessio, reporting to me.
2024 was a pivotal year for Reality Labs and positioned us for greatness in 2025. RLBG was a major part of setting us up for the future. The team beat nearly all of last year's aggressive sales and user goals, growing RL sales>40% YoY overall. We are seeing massive sales growth in wearables and the Quest brand has never been stronger. RLBG also led the charge in building out analytical capabilities and made us more customer-focused. They improved how RL operates through Must.Go.Faster. Their XFN leadership of Connect changed the way we announce our products to the world. All of which helped RL become a positive driver for Meta's overall brand.
It is this last point that is motivating this change. Keeping those functions integrated with Reality Labs makes a lot less sense when our products are now such a major driver of overall company brand and sentiment. With the rebrand to Meta and a much more integrated vision of the future, especially with AI, the inverse is also true as we depend a great deal on the rest of the company. Now that the industry has their eyes set on the categories we've defined, we'll need to tap into Meta's full power to win what comes next. That means our Go To Market needs to have tight companywide alignment.
Given these new opportunities and challenges, it's the right time to integrate RLBG's GTM teams with Meta's broader business efforts in XF. We have an opportunity to grow our full marketing funnel via FoA, leverage company-wide sales and partnership strategies to accelerate growth, and more.
Effective today:
- Brent Harris, Brett Vogel, and the business group and PMM teams will move from RL to Alex Schultz's MAGD.org, reporting to Denise Moreno.
- Colan Sewell and the RL Sales team will move to Justin Osofsky's Partnerships org.
- Alessio Sanfilippo will report to me, and Seran Chen will report to Alessio to form a unified RL Insights team and continue to drive our data and customer-focus efforts within the product group.
Dan will lead this transition and deserves special metnion. His vision, focus on execution, and ability to partner across the breadth of the business powered RLGB's success over the last 2.5 years. It is exactly that progress that has made the work of Reality Labs so important to the overall company brand that we felt compelled to make this change. He's also been a great partner to me personally in how we operate the team. I want to thank him for his outstanding leadership in Reality Labs. I can't wait to see what he does next as he explores his next opportunity here.
Our products are the best they've ever been and thanks to the teams in RLBG more people than ever are experiencing them. I am excited to see our work carry ever more weight in how the company and the world think about Meta.
Are you a Meta employee? Got insight to share? Contact the reporter Jyoti Mann via Signal at jyotimann.11 or via email at jmann@businessinsider.com. Reach out from a nonwork device.