Magic Leap reportedly laying off 1,000 employees and dropping consumer business - 2 minutes read

Mixed reality company Magic Leap is reportedly laying off around 1,000 employees and abandoning its focus on consumer headsets. Bloomberg reported the news earlier today, citing anonymous sources, and Magic Leap confirmed an unstated number of layoffs were happening on its site. “These changes will occur at every level of our company, from my direct reports to our factory employees,” writes CEO Rony Abovitz.

Bloomberg writes that in addition to laying off what amounts to half its workforce, the company will wind down its consumer-focused business, which included video games and entertainment apps. It will focus on enterprise uses, potentially including a partnership with a large unnamed health care company. Abovitz confirmed the shift to enterprise. “The recent changes to the economic environment have decreased availability of capital and the appetite for longer term investments,” he writes, and “the near-term revenue opportunities are currently concentrated on the enterprise side.”

This accelerates a transition Magic Leap — which has received more than $2 billion in funding since 2010 — was already making. The company tweaked its headset name last year to appeal more to business customers, and since the pandemic began, it’s promoted the roughly $2,300 Magic Leap One as a tool for remote work. Augmented and mixed reality hardware companies have seen greater success in fields like health care, manufacturing, and training than they have in personal computing, where headsets are still seen as an expensive and awkward novelty. But the entire industry has contracted over the past few years, with small companies like ODG and Meta folding. One of the few companies still actively promoting consumer headsets is Nreal, whose founder previously worked for (and has been sued by) Magic Leap.

Magic Leap’s future seems uncertain, but the company says it’s still moving forward with the Magic Leap 2 headset. “Given the very difficult and challenging circumstances businesses now face, there is an increased need for technologies like ours and we are currently in the process of negotiating revenue generating strategic partnerships that underscore the value of Magic Leap’s technology platform in the enterprise market,” writes Abovitz.

Source: The Verge

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