Meta's Applied AI team is in crisis as thousands of reassigned engineers report low morale, sparking company-wide complaints about layoffs and surveillance.

What happened: Meta formed a new Applied AI unit with about 6,500 engineers and product managers in March to support AI research. Engineers were reassigned without choice—joining or leaving were their only options. Current employees describe the work as menial drudgework, including generating test puzzles for AI models, and report widespread dissatisfaction. The turmoil reflects broader friction from Meta's AI-focused restructuring that involved 10 percent of the company, or 8,000 employees, being let go last month.

Why it matters: Applied AI is one of several expensive initiatives CEO Mark Zuckerberg launched to help Meta compete in the AI market. However, the unit appears to be fueling record-low morale across the company. More than 1,600 employees have signed a petition against a recently launched initiative to monitor US employees' clicks and keystrokes for AI training data. Tensions have spilled into public company meetings, with employees venting frustration during livestreamed presentations.

What to watch: CEO Mark Zuckerberg acknowledged in an internal memo that recent organizational changes caused distress and promised to limit the number of employees per manager on some teams like Applied AI, which had swelled to a ratio of 50 to one. He reiterated a vow to avoid additional mass layoffs this year and said employees in many locations would have assigned desks again by end of year. He framed Applied AI as a temporary waypoint where talented people could contribute to model advancement while other roles are created.