Meta’s Augmented Reality (AR), Virtual Reality (VR), and metaverse division, known as Reality Labs, experienced its most successful quarter to date. However, despite this peak in performance, the division continued its trend of incurring multibillion-dollar losses.
In the final quarter of 2023, Reality Labs achieved over $1 billion in revenue, marking its highest quarterly revenue ever. This significant revenue was primarily driven by the sales of its Quest headsets and Ray-Ban Meta smart glasses. Yet, even with this “best performance,” the unit still faced a loss exceeding $4 billion.
It will continue to make losses
The revenue of over $1 billion marks a new milestone for the company’s metaverse division, yet it is anticipated that it will continue to endure significant losses in the foreseeable future. Reality Labs reported a loss of $4.6 billion in the quarter and more than $16 billion in 2023.
Meta’s CFO, Susan Li, stated that these losses are expected to “meaningfully increase year-over-year” due to ongoing product development efforts in the augmented reality/virtual reality space, along with investments aimed at further expanding their ecosystem.
During a call with analysts, Mark Zuckerberg highlighted that the company’s smart glasses, in collaboration with Ray-Ban maker EssilorLuxottica, are experiencing higher-than-expected demand, leading to an increase in production plans. He also described the Quest 2 as the most popular mixed reality device, and added that both the Quest 3 and its predecessors are performing well.
Aside from Reality Labs, Meta had a robust quarter, ending 2023 with $40.1 billion in revenue. The total revenue for the year was approximately $135 billion. The daily active users (DAUs) of Facebook have reached 2.1 billion.
However, the company has decided to discontinue reporting the number of Facebook users. Meta’s latest app, Threads, is also experiencing growth. According to Zuckerberg, the service now boasts 100 million monthly users, a significant increase from “just under 130 million” in the previous fall.
Furthermore, Zuckerberg discussed his new ambition to develop artificial general intelligence (AGI) at Meta, stating that this objective will be the “theme” of the company’s product development moving forward.
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