Home » Metaverse losses top $3.6B for Meta with spending set to increase

Metaverse losses top $3.6B for Meta with spending set to increase

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Big Five tech player Meta is still burning cash through its Metaverse research and development arm, Reality Labs, with a $3.67 billion loss booked in the third quarter of 2022, and these losses He says next year will be even worse.

Company Q3 2022 Earnings It was released on October 26th.

then reality lab business After three consecutive quarters of losses totaling $9.44 billion in 2022 so far, Meta is poised to beat losses in 2021 with Metaverse plays that lost just over $10 billion last year.

As Meta CFO Dave Whener said on the earnings call, these year-over-year losses are expected to get even worse.

“We expect Reality Labs’ operating loss to increase significantly in 2023 year-on-year. We want to adjust the pace of investment.”

Commenting on Meta’s earnings call, CEO Mark Zuckerberg said: didn’t flinch It’s due to the company’s heavy investment in what he called “the next computing platform.” He said it was a top priority for the company, building a metaverse for investors, Related hardware It’s a “big business”.

“We often need several versions of each product before it becomes mainstream,” he added. “Our work here is historically significant, laying the foundation for a whole new way of interacting with each other and integrating technology into our lives, and laying the foundation for a long-term business.” think.”

Overall, the company slightly beat earnings expectations from Wall Street. Analystwhich brought in $27.71 billion in earnings for the quarter, but fell short of its estimate of $1.88 per share, buying at a gain of $1.64.

Meta shares are down more than 19.5% in after-hours trading at time of writing according to Since the beginning of 2022, the company’s stock has fallen more than 61.5%.

Related: Meta’s Web3 hopes to face challenges of decentralization and market headwinds

Meta’s big bet on virtual worlds is prompting some investors, along with Meta shareholder Brad Gerstner, founder of technology investment firm Altimeter Capital, to pull back on the company. write an open letter To Zuckerberg and the board.

Gerstner said that “an investment in an unknown future is very large and scary” and that it could take 10 years for the Metaverse to start turning a profit, and that the company will focus on providing artificial intelligence. said it should be given. company’s performance.

Some are not optimistic about the future of the Metaverse in Zuckerberg’s hands, Meta whistleblower Francis Haugen said in April. that virtual world repeats “Facebook all the harm” if the company doesn’t promise transparency.

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