Scale AI is laying off 200 full-time employees—14% of its workforce—weeks after Meta invested $14.3 billion and hired founder Alexandr Wang.
Interim CEO Jason Droege said the company expanded too quickly and became bogged down by excessive bureaucracy.
He assured staff that Scale AI remains well-funded and plans to boost hiring in enterprise and government AI divisions later this year.
The company is also ending contracts with 500 global contractors.
Google and OpenAI have recently scaled back work with Scale AI, while Meta continues deep AI investments under its new Superintelligence Labs division.