- The Meta Reality Labs unit posted an operating loss of $3.99 billion in the first quarter, after losing $13.72 billion in the previous calendar year.
- The department is charged with developing the virtual reality and augmented reality technologies that make up the Metaverse.
- Outside of Reality Labs, Meta is in a cost-cutting position as it deals with a downturn in the online advertising market.
Avatar of Mark Zuckerberg, CEO of Meta Platforms Inc. , speaking during the Meta Connect virtual event in New York, US, on Tuesday, October 11, 2022.
Michael Nagel | bloomberg | Getty Images
Meta CEO Mark Zuckerberg continues to rack up losses from his indirect investments while downsizing his social media company through cost cutting.
in the first quarter Earnings report Meta said Wednesday that its Reality Labs unit, which is charged with building virtual and augmented reality technologies for the future metaverse, posted an operating loss of $3.99 billion.
The unit brought in $339 million in revenue for the quarter, a paltry sum for a company that brings in tens of billions of dollars a quarter in advertising sales.
The numbers show a slowdown from last quarter, when Reality Labs lost $4.28 billion on revenue of $727 million.
Throughout the past year, Reality Labs posted an operating loss of $13.72 billion on sales of $2.16 billion, underlining how virtual and augmented reality technologies have yet to reach the mainstream.
Zuckerberg called 2023 the company’s “year of efficiency” and implemented major cost-cutting initiatives that include layoffs targeting an expected 21,000 employees.
But while the company is winding down, it’s still pouring billions of dollars into the metaverse after changing its name from Facebook to Meta in late 2021.
Data provided to CNBC by research firm NPD Group showed that sales of VR headsets in the United States fell 2% year over year in 2022 from December, as the holiday season failed to spark a rush of new purchases.
In March, Meta lowered the price of the Quest 2 VR headset as well as the higher-end Quest Pro. The Quest 2 now costs $70 less than before, selling for $430, while the Quest Pro has been slashed by $500 from its original price to $1,000.
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