Data labeling firm Scale AI is reducing its workforce by 14%, impacting around 200 employees and 500 contractors, as part of a strategic restructuring of its generative AI (GenAI) division. The announcement follows a significant investment in Scale AI by Meta, coupled with the hiring of Scale AI’s former CEO, Alexandr Wang, to spearhead a new superintelligence initiative at Meta.
CEO Jason Droege attributed the layoffs to previous over-expansion within the GenAI space. Scale AI intends to streamline its GenAI operations, consolidating its existing 16 “pods” into five key areas: code, languages, experts, experimental, and audio. The company’s sales and marketing will also be reorganized into a unified demand generation team.
This restructuring mirrors a broader trend of consolidation and talent reallocation within the AI industry. Scale AI is adjusting its focus to align with evolving market demands and enhance the efficiency of its data solutions for GenAI clients. While these job cuts signal a shift in strategy, Scale AI anticipates further investment and recruitment in its enterprise, public sector, and international public sector divisions in the second half of 2025.