July 16th (UPI) – Scale Ai lifted 14% of its staff on Wednesday, when Tech Giant Meta acquired a 49% stake in $14.3 billion last month and hired a CEO.
“We've strengthened genai's capabilities too quickly over the past year. At the time, it felt like the right decision, but it's clear that this approach has created effectiveness and redundancy,” Jason Doroge, who became interim CEO after the departure of founder Alexandre Wang, told employees via email.
He added: “We created too many layers, excessive bureaucracy, useless disruptions about team missions. Changes in market demand required rethinking plans and improving approaches.”
The change will result in the loss of 200 retired employees at the San Francisco-based company. And 500 contractors out of the thousands around the world will not be used, spokesman Joe Osborne told CNBC.
The company is often dependent on humans from outside the US, and its annotation focuses on data that includes companies including Google, Openai and humanity training AI models.
“We continue to be a resource-rich, funded company,” writes Doroge.
Despite the layoffs, the company plans to hire new workers later this year in regions, including businesses, the public sector and the international public sector.
“We are helping to streamline our data business, move faster and provide even better data solutions to Genai customers,” writes Droege.
Scaleai was founded in 2016.
Nine years later, the AI sector is changing rapidly.
Openai has finished working with Scale AI, and Google will cut its relationship with the company after signing with Meta.
Google plans to help Gemini code more conveniently for software developers. On Friday, the company paid $2.4 billion from license rights and AI software coding startup Windsurf.
Meta announced on June 13 that it acquired almost a majority stake in the company without voting rights to improve its competition with Openai. Wang will serve as the company's top AI executive when overseeing Meta Superintelligence Labs, the new public company founded last month. Several other Scaleai employees are participating in the meta.
Wang remains as director of Scale AI's board of directors.
In March, the US Department of Defense awarded a multi-million dollar contract for one of its flagship military programs.
On Monday, CEO Mark Zuckerberg said his company will invest the world's first super cluster next year in “hundreds of millions of dollars” online with AI.
Meta owns Facebook, Instagram, WhatsApp and threads.
In April, Meta raised its capital expenditures in 2025 from $64 million to $72 billion.
According to Semianalysis, Meta will be the first lab to offer 1 Gigawatt superclusters, or 1 billion watt superclusters online, to train advanced AI models and handle workloads.
Also, on Monday, Amazon Web Services announced Kiro. This is a program that allows designers to write code with AI help.
Also on Monday, AI Startup Awareness announced it would acquire Windsurf's intellectual property, produce, trademarks, brands and talent for private amounts.
