At least 100 employees have been laid off after Meta shut down three Austin-area gaming studios amid broader budget cuts.

“We said last month that we were shifting some of our investment from Metaverse toward Wearables,” a Meta spokesperson said in a statement Thursday. “This is part of that effort, and we plan to reinvest the savings to support the growth of wearables this year.” 

Meta Platforms Inc., the parent company of Facebook and Instagram, initially announced plans to cut up to 30% of its metaverse budget in late 2025.

Those cuts have now reached Austin, with employees reporting that Armature Studio, Twisted Pixel Games and Sanzaru Games were shut down earlier this month.

“I’ve just been laid off. It appears the entire Twisted Pixel Games studio has been shut down along with Sanzaru and Armature too,” Andy Gentile, identified on LinkedIn as a lead level designer at Twisted Pixel Games, wrote on the social media site last week.

The studio released Marvel’s Deadpool VR, a virtual reality game, in November.

Efren Flores, identified on LinkedIn as a producer at Sanzaru, wrote, “Unfortunately, due to a strategy change by Meta, Sanzaru, as well as Armature and Twisted Pixel, were shut down. I and hundreds of others were affected by layoffs.”

Armature Studio was founded by developers behind Nintendo’s acclaimed Metroid Prime franchise. It began making games in Austin in 2008 and has worked on titles including the Borderlands franchise and Fortnite. Meta acquired the studio in 2022.

Twisted Pixel was acquired by Meta’s Oculus Studios in 2020. The studio is known for games such as The Maw and Wilson’s Heart.

Sanzaru Games, which is based in California, maintained operations in Austin and is known for titles including Asgard’s Wrath 2 and Marvel Powers United VR.

The Meta layoffs are affecting employees nationwide, with the company saying it laid off about 1,500 workers from its Reality Labs division, which develops virtual and augmented reality hardware. The cuts represent about 10% of the division’s workforce. Meta has described the move as a shift in investment from virtual reality products to its wearables division, which builds smart glasses and wrist-based computing devices.

The company began investing heavily in virtual reality as part of CEO Mark Zuckerberg’s effort to reshape social networking and the internet. Zuckerberg acquired Oculus, a virtual reality startup, in 2014, laying the foundation for Meta’s hardware business.

The layoffs also come as Meta increases spending on artificial intelligence. The company has said it expects to invest billions of dollars in data centers and has stepped up recruiting for AI researchers.