Photo Credit: Meta’s Reality Labs
Meta’s ambitious move to be first in the metaverse is still costing the company billions of dollars each quarter, with the company’s Reality Labs posting a gargantuan $4.5 billion loss in Q2.
Meta’s Reality Labs unit, which includes its augmented and virtual reality technologies, recorded an operating loss of $4.48 billion as part of the company’s second-quarter earnings report posted on Wednesday, July 31. While an overwhelming loss, analysts were reportedly expecting a bigger loss of $4.55 billion.
The Reality Labs unit has generated cumulative losses of about $50 billion since late 2020, demonstrating CEO Mark Zuckerberg’s untenable investments into both the hardware and software of what he insists is the “next era of personal computing.”
Reality Labs’ revenue, which largely stems from the company’s Quest line of VR headsets and Ray-Ban Meta smart glasses, clocked $353 million — a 28% growth from $276 million the year previous. However, analysts were anticipating the unit to rake in $371 million.
Though the VR market remains a gamble, Meta has been increasingly promoting its smart glasses, which it co-develops with Ray-Ban. Zuckerberg credits advances in artificial intelligence and similar large language models as continuing to improve the capabilities of smart glasses. In early July, Ray-Ban parent EssilorLuxottica CEO Francesco Milleri, told analysts that Meta plans to become a shareholder in the European eyewear company, expanding on a previous partnership between the two that started back in 2020.
Meta’s second generation of smart glasses debuted in October, with a starting price of $299. Zuckerberg said during an April earnings call with analysts that there can be “a meaningful market for fashionable AI glasses without a display.”
Meanwhile, the company debuted its Quest 3 VR headset in September, with a starting price of $499. Just a few months later, Apple released its Vision Pro VR and AR headset, with a starting price of $3,500. In June, Apple began deliveries of its Vision Pro headset in China, with a retail price of 29,999 yuan, or $4,128.
