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Dec 05, 2025
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TGIF! Meta plans big budget cuts in metaverse-related projects. Netflix is in exclusive talks to acquire the film, TV and streaming divisions of Warner Bros. Amazon is in contract dispute U.S. Postal Service.
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Meta Platforms is discussing budget cuts as high as 30% in the group working on metaverse-related projects, including its Quest virtual reality unit, Bloomberg reported. The Bloomberg story said the cuts would likely include layoffs as early as next month. The report is a sign that Meta CEO Mark Zuckerberg has recognized that the company has to curb its spending in some areas as it ramps up spending on AI. Meta stock has fallen sharply in recent weeks, since the company said it was doubling-down on AI investments, although it rose 3.8% on Thursday
morning in the wake of the Bloomberg report. Over the past few years, Meta has lost tens of billions of dollars at its Reality Labs unit, which includes the metaverse group. As of the third quarter, it had lost $13.2 billion so far this year.
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Warner Bros. Discovery has entered into exclusive talks to sell its film and TV divisions and streaming service to Netflix, Bloomberg reported. The move would represent a seismic shift in the media landscape by combining the world’s most popular streaming service with one of Hollywood’s most prominent studios. Bloomberg said that Netflix is offering a $5 billion breakup fee if regulators don’t approve the deal and said it could be announced in the coming days. Bloomberg didn’t report a value for the deal. Warner Bros. is valued at more than $60 billion, and it plans to spin off its cable channels before a potential deal with Netflix closes.
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Amazon is negotiating its future relationship with the U.S. Postal Service, the company confirmed, although Amazon denied a Washington Post report that Amazon was considering ending its contract with the USPS in favor of its own delivery service. Amazon’s current contract with the Postal Service expires in October of next year, the Post reported. In a statement, Amazon spokesperson Steve Kelly said Amazon remained committed to working with the USPS and added ”we’ve continued to discuss ways to extend our partnership that would increase our spend with them.” One issue is that the USPS wants to run a reverse auction which would allow the highest bidder to win its delivery services, The Post reported. The Amazon spokesperson said Amazon was “surprised to hear they want to run an auction after nearly a year of
negotiations, so we still have a lot to work through.” Amazon is USPS’s largest customer, providing more than $6 billion in annual revenue or around 7.5% of the federal agency’s revenue, the Post reported. The reverse auction could make it easier for USPS to do business with smaller customers, as the postal service has prenegotiated agreements with its largest clients.
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Last week, Gap Inc. launched a chatbot to field product-related questions from Gap.com visitors, but the chatbot ended up discussing topics that fell outside the scope of questions it was supposed to handle, including intimacy products, sex toys, and Nazi Germany, according to a person with knowledge of the matter. The Information reproduced some of the results Thursday. Enterprise AI startup Sierra, privately valued at $10 billion, powered the chatbot for Gap. Rachel Whetstone, head of communications at Sierra, which was co-founded by former Salesforce co-CEO Bret Taylor, said the issue stemmed from a coordinated effort to trick its customers’ chatbots to respond to inappropriate questions. “Since last week, a bad actor has been attempting to maliciously jailbreak over a dozen of our customers’ AI agents,”
Whetstone said in a statement. “There have been multiple attempts, and it appears our built-in abuse detection system has intercepted all of them except for Gap, where we’d inadvertently misconfigured the agent’s guardrails. These controls have now been properly configured, and the agent remains live. We sincerely apologize to Gap.” It isn’t clear how many Gap customers engaged in off-color topics with the assistant, and Gap spokespeople didn’t respond to requests for comment. The episode is another example of AI chatbots and agents being a work in progress. In July, for instance, Elon Musk’s xAI apologized after its AI chatbot, Grok, made a series of X posts in praise of Adolf Hitler.
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The departures of senior executives from Apple continue to mount. On Thursday, the company announced two executives would be retiring in the coming months: general counsel Kate Adams and Lisa Jackson, vice president of environment, policy and social initiatives. Jennifer Newstead, who was recently Meta Platforms’ chief legal officer, will replace Adams in March. The government affairs organization overseen by Jackson, who will retire next month, will move under legal, while her environmental and social affairs duties will shift to chief operating officer Sabih Khan. The changes aren’t the only major departures lately of Apple leaders. Earlier this week, Apple announced the retirement of AI chief John Giannandrea, and the departure of design lead Alan Dye for Meta. Last month, longtime chief operating officer Jeff
Williams also stepped down.
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By Stephanie Palazzolo and Erin Woo
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