Facebook’s parent company Meta is having a decent day today after beating revenue and user activity forecasts for the final fiscal quarter of 2022. But their VR division doesn’t help the company make money. In fact, it’s costing the company billions of dollars in losses.
It’s true that Meta’s stock is rising In after-hours trading today, after reporting relatively upbeat fourth-quarter financial results, VR division Reality Labs had less positive news to report as it continues to waste money at a shocking rate. Today, the company confirmed that it lost over $4 billion on VR and Metaverse development in the last quarter of 2022. And overall it has lost well over 4 billion $13 billion in 2022 trying (and failing) to build a metaverse that people would flock to.
In comparison, Meta had revenue of $32.1 billion across all divisions and apps.
As reported by Decrypt.co, Metas Reality Labs brought in just $727 million in revenue in the final months of 2022. That’s not great compared to the billions spent on the department that same year, but it’s also worse than you might think. That number is 17% below the division’s revenue for the same period in 2021. Ouch.
Also keep in mind that Facebook’s flagship Metaverse software, horizon worldsIt was basically a huge flop, as he reports Most of the worlds in it are empty and rarely played. Not only that, the company’s own employees barely use it, with a leaked internal memo showing that Meta employees don’t enjoy it horizons worlds because it’s riddled with bugs and other quality issues.
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Really Reality Labs’ one major success story is the Oculus Quest 2 headset, which was seen by many as an affordable alternative to expensive PC and console VR headsets, and was also completely standalone. But in July meta increased the price of this affordable headset by $100where the 128GB model is now $400 and the 256GB version is now $500.
in November 2022, Meta laid off 11,000 employeeswho blames Covid for it, “macroeconomic downturn, increasing competition and loss of ad signal”. Zuckerberg blamed himself for the layoffs, but conveniently didn’t mention how much money the company continues to spend on VR and Metaverse development in its announcement of layoffs. Over the past few years the company has spent tens of billions of dollars trying to make a VR powered metaverse a thing.
And now, in February 2023, after massive layoffs and sustained losses, it just did an unattractive and empty PlayStation Home clone to show for all his troubles.
