- This is the biggest quarterly operating loss since the last quarter of 2020
- Reality Labs’ revenue came in at nearly $1.1 billion
Meta’s virtual reality, augmented reality, and metaverse division Reality Labs recorded a devastating loss of over $4.6 billion in the last quarter of 2023. It also posted one of its highest quarterly revenue results ever, but they didn’t make up for that.
Meta’s fourth quarter results, which the company released on Feb. 1, show that Reality Labs’ revenue came in at nearly $1.1 billion. The VR/AR research arm lost $4.65 billion at the same time.
The biggest loss since the addition of Reality Labs
This is Reality Labs’ biggest quarterly operating loss since the last quarter of 2020, when Meta first added the division to its financial reporting.
In 2023, the division’s total revenues were around $1.9 billion, with $1.1 billion of this in the final quarter alone, when it released its Meta Quest 3. This was on Oct. 10. The total operating loss was up 17.5% from 2022, amounting to a whopping $16.1 billion.
The pluses?
Meta founder and CEO Mark Zuckerberg explained in an earnings call that Reality Labs’ increased revenues were due to high demand for its Quest line of VR headsets over the holidays. He added that the latest Quest was “off to a strong start.”
Zuckerberg assured Meta’s AI and metaverse initiatives were important components of the company’s long-term vision and it would keep making pronounced investments in those areas. He expects the latest generation of AR, VR and mixed reality platforms to build the foundation of social experiences in the future by providing “a realistic sense of presence."
CFO expects losses to keep increasing
According to Meta’s chief financial officer Susan Li, the mixed reality division will keep losing money year-over-year due to hefty development costs and investments in the ecosystem.
In 2023, Meta accumulated revenue of $134.9 billion, up 16% year-over-year. Meta announced plans to issue a quarterly shareholder dividend on an ongoing basis. The tech giant will pay its first-ever dividend of 50 cents a share on March 26.
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