Meta is pivoting its Reality Labs strategy, reducing investment in the VR version of Horizon Worlds and shifting focus to third-party games for Meta Quest headsets. The move follows last week's layoffs of 1,500 staff and the closure of most first-party development studios, which sparked speculation that Meta was abandoning VR.

CTO Andrew Bosworth explained the change, stating the company will "let VR be what it is and what it does great" by concentrating on its established third-party content ecosystem. This marks a reversal from Meta's previous push to deeply integrate Horizon Worlds with Quest, a strategy that led to a decline in game sales and developer frustration.

While some see the shift as too late for studios already closed, Oculus founder Palmer Luckey defended Meta's decision, noting the company still employs the largest VR team by an order of magnitude. The real test will be whether this refocused strategy can stabilize the platform's growth and developer confidence.