February 2, 2023

Reality Labs Reports USD 4.28 Bln Losses in Q4 of 2022

Reality Labs Reports USD 4.28 Bln Losses in Q4 of 2022 Featured Image

Reality Labs

Meta Platforms’ Reality Labs virtual reality unit reported the biggest loss in a quarter, hitting $$4.28 billion in the fourth quarter of 2022, compared to $3.304 billion in the same quarter a year ago.

The company’s metaverse division posted collective losses worth $13.72 billion throughout the last year, according to CNBC. Reality Labs’s losses were more than six times its revenues in 2022 as its overall revenues recorded $2.16 billion ($727 million in the fourth quarter), compared to $2.27 billion in 2021.

These revenues are thought to be achieved due to increasing the price of its Oculus Quest 2 headsets by $100 to $400 in August 2022 for inflationary pressures, in addition to the launch of the Meta Quest Pro, an enterprise high-end version of its headset, for $1,500.

Reality Labs is expected to continue recording losses in 2023 and they could be bigger in the coming quarters.

Commenting on the news, Meta founder and CEO Mark Zuckerberg stressed that these numbers would not shift the company from its long-term strategy for the metaverse, saying: “None of the signals that I’ve seen so far suggest that we should shift the Reality Labs strategy long term.”

Zuckerberg pointed out that his company intends to launch another “next-generation consumer headset” following the Quest Pro.

Meanwhile, Meta’s chief financial officer, Susan Li, noted that the company would continue to meaningfully invest in this area given the significant long-term opportunities.

Meta said last year that it expected that Reality Labs operating losses in 2023 will remarkably increase year-over-year, adding: “Beyond 2023, we expect to pace Reality Labs investments such that we can achieve our goal of growing overall company operating income in the long run.”

Meta’s total revenues for the fourth quarter was $32.1 billion, revenues increased in Meta’s stock price, gaining nearly 19.5% in after-hours trading at the time of writing.

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