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Meta Reports Q4 Operating Loss Of $4.279bn
By Vishakha Thakur
Mark Zuckerberg’s vision of a future in the metaverse is costing investors a fortune. In its earnings report on Wednesday, Meta’s Reality Labs division, which is home to the company’s virtual reality technologies and projects, reported a $4.28 billion operating loss in the fourth quarter, bringing its total for 2022 to $13.72 billion.
Reality Labs earned $727 million in the fourth quarter and $2.16 billion in total revenue in 2022, down from $2.27 billion in 2021. The division lost more than six times the amount of money it earned last year. Meta announced in July that it was raising the price of its Quest 2 VR headset by $100. The company stated that the price increase was required to account for inflationary pressures. Meta then debuted its more expensive Quest Pro VR headset in October, pitching it to companies as an enterprise-workplace device for $1,500.
Zuckerberg has been working hard to make his metaverse dream a reality, and he hopes to have a billion people in the metaverse doing hundreds of millions of dollars in commerce. Last year, the company stated that “Reality Labs operating losses in 2023 will grow significantly year over year.”
Last year, Meta lost nearly two-thirds of its value as metaverse costs skyrocketed and the company’s core online ad business was harmed by a struggling economy, increased competition from TikTok, and Apple’s privacy update, which limited ad targeting. The company reported fourth-quarter earnings that exceeded analysts’ revenue estimates and announced a $40 billion buyback on Wednesday, sending the stock up more than 17% in extended trading.
In late 2021, Zuckerberg renamed the company and declared that its future would be in the metaverse, a digital universe in which people will work, shop, play, and learn. However, before the Facebook founder’s dreams become a reality, Meta must invest billions of dollars in developing the virtual and augmented reality technologies that underpin the metaverse concept.
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