April 22, 2024

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Meta Burns Billions of Dollars in Metaverse

Meta Burns Billions of Dollars in Metaverse

Who said building a metaverse would be easy and cheap? this week, Goal Presentation of the financial results for the first quarter of the year, and that was one of the most prominent points Reality Labs keeps losing money when you turn it in the fist. Facebook’s virtual reality team generated $695 million in revenue, but Lost $2.96 billion in the same period.

In this way, the partition Accumulated losses of nearly 20 thousand million dollars since 2020. And everything indicates that the story will continue as it is for some time, especially if we take into account that Mark Zuckerberg’s private company is confident that it will continue 5 to 10 years left In order for the metaverse to realize its potential.

An important point to note is, according to Mentioned by MetaReality Labs increased its revenue compared to the first quarter of last year. As indicated at the beginning, the division was able to generate $695 million thanks to an increase in sales of virtual reality software and hardware. While in the first three months of 2021 this figure was $534 million.

however, Losses also increased.. Just as in the first quarter of last year it was for $ 1,830 million, this year it increased to $ 2,960 million; That is, the bleeding grew by more than 1,100 million dollars compared to the two periods.

The trend is clearly not new. Over the past two years, Reality Labs has gradually increased its revenue but has also suffered increasing losses. Something that has already raised alarm among investors who view betting on Metaverse with some skepticism.

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In 2020, Meta’s virtual reality division (Facebook, at the time) had revenue of $1.1 billion and an operating loss of $6 billion. In 2021, revenue was $2.3 billion and losses increased to $10.2 billion. And everything indicates that the numbers in red this year will be even more difficult; In the end, In the first quarter of 2022, Reality Labs lost more than it had made in the whole of last year.

The metaverse is already sending chills down the spine of Meta contributors

Photo: Robin Chicharo.

When Facebook became the targetIn October of last year, it began reporting results from Reality Labs separately. At the time, Mark Zuckerberg stated that an investment of $10,000 million would be allocated to developing the metaverse. But what’s behind the noise InitialAnd Shareholders are finding it increasingly difficult to keep up with the company’s huge expensesKnowing that its potential fruit will not come until after a decade.

s Stubborn pressure in metaverses It causes stress within the company itself. In January it became known that a large number of Meta employees were practical Had to reapply In positions related to the development of augmented reality and virtual reality solutions; and that 25% of new job searches were related to this category.

Let’s remember that when Mita confirmed it lost users For the first time in history, the value of its shares decreased by 24%. this means Losing $230,000 million in valuation in one daywhich is unprecedented in the United States.

Moreover, the general financial resources of the company remain in good shape. In fact, the company reported revenue of $27.9 billion in the first quarter of 2022, an increase of 7% over the same period in 2021. This seems to give Mark Zuckerberg the freedom to continue spending in the metaverse without worrying either.

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It will be necessary to see if developments in this matter help calm investor anxiety. Prepares dead to present this year mixed reality glasses Developed by Reality Lab; According to Zuckerberg, It will have the ability to replace computers in work environments. In terms of software, the focus is on the web version of Horizon Worlds, available today only in Earphone from virtual reality.