HardwareVR HardwareA decade after buying Oculus VR, Meta’s Reality Labs' losses are spiralling out of control, with no end in sightWhen you purchase through links on our site, we may earn an affiliate commission.Here’s how it works.
HardwareVR HardwareA decade after buying Oculus VR, Meta’s Reality Labs' losses are spiralling out of control, with no end in sightWhen you purchase through links on our site, we may earn an affiliate commission.Here’s how it works.
When you purchase through links on our site, we may earn an affiliate commission.Here’s how it works.
(Image credit: Future)
However, in the same year, Reality Labs had spent a little under $8 billion, giving the whole division an operatinglossof $6,600,000,000. That figure was worse in 2021 ($10b loss), 2022 ($10.1b loss), and in 2023 ($13.6b loss). According to Yahoo Finance, Meta is estimated to have already lost between $8.4 and $8.8 billion so far in 2024.
This time last year,Meta’s chief financial officer issued a warningin its Q2 financial report that “for Reality Labs, we expect operating losses to increase meaningfully year-over-year due to our ongoing product development efforts in augmented reality/virtual reality and investments to further scale our ecosystem.”
But how exactly does one turn around from having an operating loss multiple times the size of the revenue? And even if Reality Labs starts making a profit next year, shareholders are unlikely to be happy with the amount of expense accrued just to get to that point.
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The one that started it all, the original Oculus Rift
At the moment, Meta has four AR/VR products on the market—Quest 2, Quest 3, Quest Pro, and Ray-Ban Meta smart glasses. It’s claimed, though, that in the past, Meta had 24 hardware products on an 18-month schedule, which seems like a ludicrous number of devices to develop, streamline, and support.
Virtual reality(Image credit: Valve)Best VR headset: which kit should you choose?Best graphics card: you need serious GPU power for VRBest gaming laptop: don’t get tied to your desktop in VR
Virtual reality
(Image credit: Valve)Best VR headset: which kit should you choose?Best graphics card: you need serious GPU power for VRBest gaming laptop: don’t get tied to your desktop in VR
(Image credit: Valve)
Best VR headset: which kit should you choose?Best graphics card: you need serious GPU power for VRBest gaming laptop: don’t get tied to your desktop in VR
It’s probably not helped that Meta spent an undisclosed amount of money developing its own chips to use in AR and VR products, before deciding to switch to Qualcomm processors in 2021—apparently to the fury of its engineers. And over the years, Meta has lost some of its key figures in VR, such as Oculus co-founder Nate Mitchell and legendary game developer John Carmack, leaving in 2019.
How much longer Meta is willing or able to sustain such losses is unknown butits share priceis almost as high as it has ever been, so the market doesn’t seem overly concerned at the moment. Given how much Zuckerberg has invested himself in all things augmented and virtual when it comes to reality, I can’t see Meta shutting down or selling off its Reality Labs just yet, but there’s no infinite pot of gold to keep things afloat.
So don’t be too surprised if it turns out that Meta’s excellent Quest 3 headset is the last VR hurrah for its Reality Labs.
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This upcoming Micro-OLED VR headset has absolutely everything and weighs less than 200 grams but of course it costs nearly 4x the Quest 3
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Meta could take a step back from designing VR headsets and lend other companies access to its Horizon OS instead
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LatestEpic CEO Tim Sweeney says tech leaders are ‘pretending to be Republicans’ to gain favor with Trump, skirt antitrust laws, and ultimately ‘rip off consumers and crush competitors’See more latest►
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Epic CEO Tim Sweeney says tech leaders are ‘pretending to be Republicans’ to gain favor with Trump, skirt antitrust laws, and ultimately ‘rip off consumers and crush competitors’
Epic CEO Tim Sweeney says tech leaders are ‘pretending to be Republicans’ to gain favor with Trump, skirt antitrust laws, and ultimately ‘rip off consumers and crush competitors’
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