Thu Jul 17 09:10:00 UTC 2025: **FOR IMMEDIATE RELEASE**

**Scale AI Cuts 14% of Workforce Despite Recent Meta Investment and Executive Hire**

*San Francisco, CA* – Just weeks after securing a $14.3 billion investment from Meta and the high-profile hire of its founder, Alexandr Wang, as Meta’s Chief AI Officer, AI startup Scale AI is laying off approximately 200 full-time employees, representing 14% of its workforce.

Interim CEO Jason Droege attributed the cuts to overzealous expansion into generative AI and the resulting bureaucratic bloat. In a memo to employees obtained by CNBC, Droege stated the company ramped up its generative AI capacity too quickly and created too many layers of excessive bureaucracy. He emphasized that Scale AI remains “well-resourced and well-funded” and that the changes will allow the company to be more agile and responsive to market demands.

“These changes will make us more nimble — enabling us to react more quickly to shifts in the market and customer needs,” Droege wrote.

The layoffs coincide with reports that major clients like OpenAI and Google are reducing or ending their work with Scale AI. OpenAI has been winding down its partnership for the past year, and Reuters reports Google is also cutting ties after Meta’s investment and the Wang hire.

Despite the job cuts, Scale AI plans to increase headcount within its application business units, including enterprise, public sector, and international public sector divisions, in the second half of the year. The company is also ending contracts with approximately 500 contractors worldwide.

“We’re streamlining our data business to help us move faster and deliver even better data solutions to our GenAI customers,” said Scale AI spokesperson Joe Osborne. “We also plan to make significant investments and hiring across our enterprise and government AI businesses.”

Meta’s recent investment and hiring spree, including bringing on Wang to lead Meta Superintelligence Labs, highlights the intense competition for top AI talent. The layoffs at Scale AI, despite these developments, raise questions about the company’s strategic direction and the impact of losing key clients like OpenAI and Google.

Scale AI, founded in 2016, specializes in preparing data for training AI models for major tech companies. Impacted employees are receiving severance packages.

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