Magic Leap Inc., the heavily funded mixed reality startup, has reportedly laid off its sales and marketing teams.

Bloomberg today cited sources as saying that the restructuring affected about 75 employees. It’s unclear if the job cuts were limited to the sales and marketing departments or also hit other units. According to the report, Magic Leap will provide the departing staffers with two months of severance pay.

The company confirmed the job cuts in a statement. “Magic Leap has been evolving our go-to-market approach to better align with market dynamics and emerging opportunities, optimizing how we support our customers and our ecosystem,” a Magic Leap spokesperson told Bloomberg. “As part of this, we have consolidated our frontline engagement to our developer support and care teams.”

The job cuts reportedly come amid a major shift in the company’s business strategy. Magic Leap launched in 2010 to develop mixed reality headsets for consumers. According to today’s report, the company will now refocus on licensing the optical technology that underpins its headsets to other organizations.

Magic Leap’s first mixed reality device, the Magic Leap One, debuted in 2018. It was a consumer-powered headset with a small companion computer that users could clip onto their clothing. The latter device performed most of the computations involved in running applications.

The Magic Leap One launched to mixed reception. Two years after the device’s debut, the company let go half of its workforce and announced plans to refocus on the enterprise market. This pivot produced the Magic Leap 2, an upgraded version of the Magic Leap One that debuted in 2022 with a lighter, more comfortable design and a broader field of view.

The company’s newly reported shift to licensing is said to follow months of uncertainty. According to Bloomberg, the move is seen as a “last-ditch attempt” by executives to salvage Magic Leap. The licensing push reportedly will focus on the company’s optical technology, the collection of hardware components its headset uses to render content in front of the user’s eyes.

Magic Leap’s website states that it holds thousands of patents worldwide. Some of those patents cover the company’s optics technology, which it says can mitigate the most common rendering issues in mixed reality headsets. Those challenges include image blurring and a phenomenon called vergence accommodation that can cause eye strain.

According to Magic Leap, its optical technology is suitable for use in not only headsets but also more compact devices such as smart glasses. The company says that it has developed an “ultra-light” projector, the component responsible for producing the light a headset uses to illuminate its built-in displays. The component’s lightweight design makes it relatively easy to integrate into space-constrained augmented reality and mixed reality products.  

According to Magic Leap, its optical technology also removes the need to equip headsets with parts known as external refractive lenses. That enables hardware makers to further compress their devices’ form factor. 

That Magic Leap’s optical technology lends itself to building compact mixed reality devices could potentially make it useful for Meta Platforms Inc. The Facebook parent last year teamed up with EssilorLuxottica SA, the maker of the Ray-Ban sunglasses, to launch a series of artificial intelligence smart glasses. The devices are considerably smaller than a standard mixed reality headset, which means they could potentially benefit from Magic Leap’s compact optical components.

Magic Leap may also seek to license its technology to Google LLC. Last month, the companies announced that they’ve inked a “strategic technology partnership” focused on the augmented reality market. Magic Leap didn’t go into details about the technical goals of the collaboration, but indicated that Google intends to make use of its optical technology.  

Photo: Magic Leap