Meta Platforms (META) reportedly has frozen hiring in its high-profile artificial intelligence division as investors grow concerned about the unit’s surging costs.
According to The Wall Street Journal, the tech giant began the freeze last week amid a broader restructuring, and exceptions would require the approval of chief AI officer Alexandr Wang. Meta has hired 50-plus AI engineers and researchers for the four-team unit, and “prohibits current employees from moving across teams inside the division,” the report said.
Meta hired Scale AI CEO Wang in June to lead an AI “superintelligence group.” The tech giant has been among the most aggressive in the sector in poaching engineers and researchers to staff up its AI division, reportedly offering nine-figure pay packages as well as using so-called “reverse acquihires,” where it buys into a startup to get its leaders, as it did with Scale AI. The Journal said that some analysts are worried that Meta’s stock-based compensation costs would threaten shareholder returns.
Meta didn’t immediately respond to an Investopedia request for comment.
The tech firm’s shares, which entered Thursday up 28% this year, are little changed in premarket trading.