VR-focused company PICO is laying off about 300 employees

We continue to see more layoffs in the technology industry, this time it is the turn of BEAK, a well-known company focused on the business of virtual reality glasses. It must be remembered that this company is owned by the Chinese technology company bytedance. Company that also owns other highly relevant companies such as TikTok.

Currently, PICO has about 2,000 employees. Previous rumors indicated that the layoffs would affect between 20 and 30% of the employees. This means that the company would be planning to lay off between 400 and 600 people. PICO has made an official statement indicating that this organizational setting has been carried out, but that the actual rate of layoffs is lower than what the rumors say.

Finally, about 300 workers will be laid off. These are linked to the Mixed Reality division Created in the summer of 2022 to develop hardware and software. All this despite the fact that they sought to be profitable in the year 2027.

Layoffs waiting to see how sales of the new PICO VR glasses work out

These layoffs come before the company launches its new virtual reality glasses PEAK 4 Pro. While these were expected to arrive in 2022, they are now expected to arrive between the months of April and May of this year. The delays are linked to the fact that some of the necessary research and development work had not yet been completed. After they were not released in 2022, their release was postponed to the end of the current month of February, but it was finally delayed once again.

Additionally, the company is expected to launch other VR glasses based on the PICO Neo 3. These glasses are focused to the low-end market. In essence, a model that helps them compete more strongly with Meta and hers hers Oculus glasses. PICO closed 2022 with a market share of 15%, while that of Meta was reduced to about 75%. On the other hand, it must be remembered that ByteDance’s planning for PICO includes global expansion. Currently, PICO has covered Europe, Southeast Asia, Japan and South Korea, and will enter South America and the United States soon.

So far, ByteDance has spent a few 2.915 million dollars at PEAK. But for every PICO device sold, the company has a loss of $135 to $440. In this respect, PICO claims that it does not conform to the actual situation. As for the $2.915 million investment, PICO said it would not comment on it.

PICO denies that the delays are linked to internal disputes and product defects

In closing, PICO founder Henry Zhou said last year that the sales target for PICO 4 is more than 1 million units, and that the PICO Neo 3 had achieved sales of 500,000 units in the second quarter of 2022. According to former PICO employees, PICO’s 2022 domestic sales target was 1 million units. At the moment of truth, the company only completed sales between 700,000 and 800,000 units in that year.

After facing practical challenges, PICO set out to be a little more pragmatic. Former employees have claimed that Henry Zhou has rarely attended bi-monthly meetings in recent months, and executives thought his earlier statements about the VR industry were too optimistic. As a result, the company would reduce their expectations and the investment of resources for PICO this year.