Meta is experiencing losses across divisions linked to its metaverse project, which was launched by chief executive Mark Zuckerberg in a bid to revamp the company behind Facebook.
Reality Labs, for example, posted a loss of $4.28bn in the final fiscal quarter of 2022. As to Meta’s overall losses reported in an update on Wednesday, the company has lost $13.72bn.
Reality Labs only generated $727m in revenue in the last quarter of 2022, which was down 17% on a year-over-year basis.
In other words, interest in the metaverse, or at least the one offered by Meta (formerly known as Facebook) has been tepid to say the least.
Reality Labs has been working on several consumer-focused projects it hoped could appeal to consumers.
The worrying performance though has not quashed enthusiasm within Meta, which remains optimistic about the future.
After all, the metaverse is expected to be worth $5tr by the end of 2030. Meta noted that while losses were still being generated, it has exceeded in several key metrics, including the number of daily active users, the monthly active users, and the average revenue per user.
All three factors were in fact better than previously anticipated, giving Meta a lot of wiggle room to navigate despite the temporary financial setbacks.
Overall, Meta managed to generate $32.1bn in revenue, ahead of the $31.53bn figure. Zuckerberg assured though that 2023 will be a year of efficiency, having already laid off 11,000 people last quarter.
The executive noted that projects that simply do not perform well will end up shut down, but apparently the metaverse-focused initiatives are not part of the immediate culling plans as optimism reigns in Meta’s earnings calls – for now.
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