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Meta, which owns and operates Facebook and Instagramas well as Threads, Messenger, and WhatsAppannounced on Wednesday it is laying off about 600 employees from its new AI “superintelligence” research lab. The news was first reported by Axios. Fast Company has reached out to Meta for comment. That lab, dedicated to pursuing an artificial intelligence system that would reportedly surpass human intelligence, was announced back in June after Meta said it was investing $14.3 billion in Alexandr Wang’s Scale AI and bringing him on board. The cuts come as Big Tech ramps up its investment in artificial intelligence, pouring billions in an increasingly competitive, high-stakes AI arms race. Meta CEO Mark Zuckerberg says the social technology company plans to invest between $60 billion and $65 billion in capital expenditures in 2025 alone. At the same time, Meta has been rolling out AI advertising features at a dizzying rate, and is also reportedly building a large Manhattan data center to power its AI offerings. “By reducing the size of our team, fewer conversations will be required to make a decision, and each person will be more load-bearing and have more scope and impact,” Meta chief AI officer Alexandr Wang wrote in a memo, Axios reported. Meta financials Shares in Meta Platforms, Inc. (NASDAQ: META) took a dip in morning trading on Wednesday, but for the most part recovered, and were trading down 0.4% by midday at the time of this writing. In its second quarter 2025 earnings release, for the period ending on June 30, Zuckerberg wrote, “We’ve had a strong quarter both in terms of our business and community: I’m excited to build personal superintelligence for everyone in the world.” The company beat expectations with revenue coming in at $47.52 billion, versus estimates of $44.80 billion. Earnings per share (EPS) came in at $7.14, higher than the expected $5.92. The company’s third quarter 2025 financial results will be released after market close on Wednesday, October 29.
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From July 14 to November 9, 2023, the American actors’ union SAG-AFTRA, representing 160,000 people, went on strike over a labor dispute with the Alliance of Motion Picture and Television Producers. Eventually, both sides agreed to terms that theoretically would put limits on how actors images and output could be used. Strike over, everybody went back to work and the entertainment industrial complex started humming again. But they apparently never took heed of the lessons offered by a somewhat obscure 2013 movie, The Congress, which eerily anticipated the crisis Hollywood is now facing. Caught by surprise? Really? Fast-forward to September of 2025. Dutch actor and comedian Eline Van der Veldens company Particle6 released an AI “actor” named Tilly Norwood with the express intention of her becoming the next Scarlett Johansson. The bot had its own social media presence, appeared in comedy sketches, and breathlessly declared, “I may be AI, but I’m feeling very real emotions right now. I am so excited for what’s coming next!” The news that there were agents in talks to sign Norwood, the way they might sign a real actor, sparked an incredible Hollywood firestorm. Lots of denunciations of this use of technology. Lots of claims that this was unfair. And lots and lots of workplace anxiety. But should they really have been this surprised? Futurist Amy Webb suggests not. As she says, Lets not kid ourselves: theyve had more than a decade to prepare for this. Toy Story, launched in 1995, was the first full-length feature film to be fully animated, followed by a string of other hits that did very well without real actors, thank you very much. Lara Croft, the Tomb Raider game star that was launched in 1996, became a movie character in 2001. In 2002, a simulated movie star played the lead in the science fiction movie Simone. In 2011, Japanese idol group AKB48 introduced a new memberAimi Eguchi. She became popular and was added to the band only to graduate when her identity as a composite of the bands other actors was revealed. By 2016, we had AI-generated influencers like Lil Miquela who appear in advertisements, garner thousands of followers, and are paid to endorse brands. And the precedent for Tilly signing with an agent has already been establishedMiquela signed on with CAA as its first virtual client as far back as 2020. View this post on Instagram A post shared by Tilly Norwood (@tillynorwood) Willful blind spots Now seemingly caught by surprise, what did the strategists in Hollywood miss? Most likely, too much focus on their own industry. Fractious labor relations, contract negotiations, and changing entertainment consumption behavior can eat up a lot of executive bandwidth. This leads to not thinking in terms of the larger arenas in which competition takes place. The big threat to this business was not other industry players but something coming along that made what they did unnecessary, undesirable, or too expensive. Once an innovation has demonstrated its efficacy, particularly if it is popular and making money for someone, it is almost impossible to put the genie back in its bottle (see: targeted Internet advertising or ride-sharing). It is also no secret that some moviemakers longed to put AI-generated actors in leading roles, even experimenting with bringing some back from the dead. But perhaps the most significant reason I believe they didnt pick up on the weak signals is because they didnt want to. Accepting the idea of digital acting and the creation of digital worlds means accepting the idea that expertise, talent, and painfully acquired skills will become obsolete. Unfortunately, the law of disruptionin which the complicated and difficult becomes easy and the expensive becomes cheapdoesnt really care about your preferences. Preparing for an existential threat What might they have done to prepare? They could have launched small-scale experiments using digital actors to learn about audience acceptance, production workflows, and creative possibilities. They could have allocated resources to dedicated teams exploring new forms of storytelling. With the constraints of physical acting and reality removed, stories could be developed that could be as revolutionary as the movies themselves were when they created new possibilities beyond what could be done on a physical stage. They could have worked with regulators and their unions to establish a glide path for AI in their sector that would be fair with respect to intellectual property. They could have seriously invested in the digital technologies used to create these new forms of entertainment, rather than leaving all this to technology companies such as Netflix. The end of mass market entertainment? Tilly Norwood isn’t the disruptionshe’s the warning shot. The real disruption comes when AI can generate not just actors, but entire films, on demand, personalized to individual viewer preferences, at essentially zero marginal cost. The studios that survive won’t be the ones with the biggest IP libraries or the most prestigious awards. They’ll be the ones who recognize that the fundamental assumptions of their industrythat content is scarce, that talent is human, that stories are fixedare all being systematically dismantled, and come up with new business models that take advantage of the post-inflection point world. The weak signals are there. The question is: who has the appetite to listen?
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E-Commerce
San Diego-based Shield AI is developing a first of its kind fighter jet: a 2,000-mile-range pilotless plane that takes off and lands vertically and uses artificial intelligence to fly itself, even when adversaries jam navigation and communication systems. Like the company’s smaller, combat-tested autonomous drone, the V-BAT, the X-BAT doesn’t need a runway, allowing it to launch from remote islands or the decks of aircraft carriers or drone ships. But with its larger blended wing body design, the X-BAT can carry missiles and electronic weapons. Instead of propellers, it’s powered by an afterburning jet engine. Airpower without runways is the holy grail of deterrence, said Brandon Tseng, Shield’s cofounder and president. The aircraft could join a new class of AI-piloted fighter jets being developed for the Pentagon and other defense agencies, where the aim is to deploy robotic wingmen alongside human pilots or as part of separate drone squadrons. Taking their cue from the fierce drone war in Ukraine, military officials around the globe are eyeing layers of cheaper, more disposable AI-powered drones on air, land, and sea, with a single soldier responsible for an entire swarm. A separate race is on to field counter-drone systems. Investors have followed suit, pouring cash into a range of defense-tech firms, including Shield rivals like Anduril, Helsing, and publicly traded AeroVironment, or AV. Globally, venture capital investment in defense companies surged to $31 billion last year, a 33% increase over the previous year, according to McKinsey. Anduril, founded in 2017, is the largest of the so-called “neo prime” contractors, with a valuation at around $30 billion. Shield, founded in 2015 and valued at $5.3 billion, is the next biggest defense startup. (Fast Company named it a Most Innovative Company in 2020.) The X-BAT’s tail-less blended wing body aims for added lift [Image: Shield AI] With the X-BAT, Shield joins a number of startups and legacy contractors developing AI aircraft that can match the capabilities of an F-16 but in a smaller form factor. Last month, Shield was picked by the Air Force to provide the AI software for the YFQ-44, Anduril’s entrant in the service’s Collaborative Combat Aircraft (CCA) competition. Defense giant RTX was selected to build the software for the other drone prototype being considered by the Air Force, the YFQ-42, built by General Atomics. Both drones are roughly the same size as the 26-foot-long X-BAT, which is about a third as large as a conventional fighter jet. The service has said it plans to choose a design for production by fiscal year 2026, and has indicated it may select multiple companies. Last month, Breaking Defense reported that the Navy had selected another set of drone designs by Anduril, Northrop Grumman, Boeing, and General Atomics for its own collaborative combat aircraft competition. The Army and the Marine Corps are also making plans for their own “loyal wingmen.” Tseng declined to comment on Shield’s role in the current CCA program, or on the potential of X-BAT to enter a future competition. Still, he said the aircraft’s price, at around $27 million, is in the same range as the Collaborative Combat Aircraft programs, with variations based on mission systems and configurations. That translates to about a tenth of the cost per effect compared to legacy fifth-generation aircraft, Tseng said. X-BAT also represents a major development for Shield AIs business, the company said in a press release. We believe the greatest victory requires no war, said Tseng. To make that belief real, were executing a simple but ambitious master plan: Prove the value of autonomy, scale it across domains, and reimagine airpower. X-BAT represents the next part of that plan. The X-PAD on its launch pedestal [Photo: Shield AI] Up and down Shield AIs plans have taken several turns in recent years. Founded in 2015 by brothers Brandon and Ryan Tseng and Andrew Reiter, the 1000-person company has sold hundreds of its V-BAT drones. But after it landed a $240 million funding round in March, Brandon told Bloomberg that the company would place more of an emphasis on its AI software, which had been a larger focus before it bought longtime V-BAT maker Martin UAV in 2021. The company has generated billions of dollars in revenue, and had planned to reach profitability by 2025. But as Forbes reported in May, those projections were scrapped after a service member had his fingers partially severed during a V-BAT landing in 2023. Shortly before Forbes published its story, Ryan Tseng stepped down as CEO, and Gary Steele, a Cisco executive, took the helm. (Ryan became chief strategic officer and remains on the board of directors.) Shield AI founders Brandon and Ryan Tseng [Photo: Shield AI] Company officials have said they have taken a number of steps to address safety concerns, including adding unassisted launch and land capabilities to the V-BAT. The service member has since fully recovered. Today, V-BAT retains a perfect record of no injuries when following trained procedures, Tseng told Forbes. While the accident “delayed” the decisions of prospective customers, “we are back on track now,” he said. A human still in the loop In recent months, Shield’s software division has entered partnerships with legacy defense contractors including RTX, Airbus and shipbuilder HII to incoporate AI into their vehicles and weapons systems. Shield’s Hivemind softwarewhich grew out of Chief Technology Officer Nathan Michael’s research at Carnegie Mellon University, as well as AI startup Heron Systems, which Shield acquired in 2021can help pilot vehicles ranging from attack drones to F-16s, helicopters and boats, operating individually or in swarms. Shield conducts wind tunnel tests on an X-BAT mock-up [Photo: Shield AI] Last year, Air Force Secretary Frank Kendall flew in a test fighter piloted by Shield AI’s algorithms, taking on a manned F-16 in a simulated dogfight over the California desert. Shield AI aspires to service the autonomous needs for the defense sector, like Palantir services its intelligence needs,” Brandon Tseng told Bloomberg in March. (Shield also announced a partnership with Palantir last year, under which the firms would use each others software.) Shield AI also continues to develop the V-BAT. The 9-foot-long drone, which can fly more than 80 miles and stay aloft for more than 13 hours, carrying a payload of about 40 pounds, has been used by Ukraine, Israel, and other countries to carry out reconnaissance and targeting operations. U.S. special forces have deployed the V-BAT, and the Coast Guard, which has a five-year contract with Shield AI worth $200 million, has used the drone with “joint forces” to interdict billions of dollars worth of narcotics, Tseng said. Shield engineers with a V-BAT [Photo: Shield AI] Through over 150 V-BAT deployments in Ukraine, the AI software has also been put through its paces in places where GPS and other communications aren’t available. “Youre telling the aircraft, hey, this is your zone of operations, we want you to do X-Y-Z in this area,” Armor Harris, Shield’s senior vice president of aircraft, told The War Zone. And “given its last set of instructions and the rules of engagement for what its allowed to do, what its not allowed to do, itll go and itll continue its mission autonomously when those comms links are not there.” That capability is “where the system is more advanced than anything else in the world to date.” Still, not everything is autonomousyet. “Fundamentally [at] Shield AI, we believe that a human should be on-the-loop for an offensive kill decision,” Harris said. All-out drone push The Collaborative Combat Aircraft programs are part of an all-out push at the Pentagon (and in Silicon Valley) for AI and drones. In June 2025, President Donald Trump issued an executive order called Unleashing American Drone Dominance that aims to accelerate commercialization of drone technologies, and the administrations budget request has allocated billions of dollars to unmanned systems and AI. That includes an effort to onshore the supply chain for drones and the electronics and minerals they require, which is currently dominated by China. Shield AI has some experience here: In March, the Chinese Ministry of Commerce placed 15 U.S. entities, including Shield AI, on its export control list, barring them from the export of dual-use commodities. [Photo: Shield AI] Shield is working with Pratt & Whitney and GE to develop the X-BAT’s jet engine. Company officials declined to share further details on the engine, or how it handles takeoff and landing. But Tseng pointed to subsystems built with proven U.S. partners to ensure performance, reliability, and resilient American supply chains. Tseng said the company expects to conduct initial vertical takeoff and landing demonstrations for X-BAT as early as fall 2026, followed by all-up flight testing and operational validation in 2028. As for possible X-BAT manufacturing sites, Tseng said, we are in discussions with several states and their leadership.” And if some defense agency eventually places an order, he added, “the selected location will create thousands of jobs and generate billions in economic value.”
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