Meta Metaverse Division Posts $4.3B Net Loss in Q4 2022

Meta, led by metaverse-obsessed CEO Mark Zuckerberg has released its earnings for 2022’s fourth quarter, and it doesn’t look good

article-image

Frederic Legrand – COMEO/Shutterstock.com modified by Blockworks

share

The net losses endured by Meta’s division responsible for producing metaverse-related technology continue to grow quarter over quarter — as the damage amounted to nearly $4.3 billion in the final three months of 2022.

Despite the hit to the unit known as Reality Labs, the tech giant’s net income for the quarter stood at $4.65 billion, as its family of apps unit posted a gain of $10.7 billion. The segment includes Facebook, Instagram, Messenger and WhatsApp.

Meta’s stock price was $153.12 at the end of the trading day, down more than 50% over the past year but up about 23% in the last month. The price was up about 19% in after-hours trading, as of 6 p.m. ET.

The results came after Meta revealed on its November earnings call that Reality Labs lost nearly $3.7 billion during the third quarter — up from the division’s second-quarter loss of $2.8 billion and a $2.9 billion loss in the first quarter.  

Reality Labs’ net loss totaled $13.7 billion last year, the company revealed Wednesday.

The division includes augmented reality, virtual reality and the company’s metaverse software platform.

Then-Meta Chief Financial Officer David Wehner said in a November statement that the company was expecting Reality Labs’ operating losses to grow year over year in 2023.

Susan Li, who has since taken over as Meta’s chief financial officer, reiterated that projection during Meta’s earnings call Wednesday. 

“We’re going to continue to invest meaningfully in this area given the significant long-term opportunities that we see,” she said.

Meta CEO Mark Zuckerberg added the company is “constantly tuning the roadmap” for Reality Labs. 

“Even though none of the signals I’ve seen so far suggest that we should shift the Reality Labs strategy long-term, we are constantly adjusting the specifics of how we execute this,” Zuckerberg said. 

The continued losses in this business segment come after Facebook changed its name to Meta in October 2021 to capitalize on the anticipated metaverse trend. 

Zuckerberg said on the company’s November call its future initiatives include a social metaverse platform with avatars, augmented reality and neural interfaces.

“I get that a lot of people might disagree with this investment,” the CEO added at the time. “But from what I can tell, I think this is going to be a very important thing, and I think it would be a mistake to not focus on any of these areas, which I think will be fundamentally important to the future.”

About a week later, Zuckerberg said in a letter the company decided to layoff about 11,000 employees — roughly 13% of Meta’s workforce.


Don’t miss the next big story – join our free daily newsletter.

Tags

Upcoming Events

WED - FRI, OCTOBER 9 - 11, 2024

Pack your bags, anon — we’re heading west! Join us in the beautiful Salt Lake City for the third installment of Permissionless. Come for the alpha, stay for the fresh air. Permissionless III promises unforgettable panels, killer networking opportunities, and mountains […]

MON - WED, MARCH 18 - 20, 2024

Crypto’s premier institutional conference returns to London in March 2024. The DAS: London Experience:  Attend expert-led panel discussions and fireside chats  Hear the latest developments regarding the crypto and digital asset regulatory environment directly from policymakers and experts   Grow your network […]

recent research

Pyth Cover.jpg

Research

Pyth is a low latency pull-based oracle. In a future that looks increasingly high frequency, with various alt L1s and L2s that have significantly shorter block times than Ethereum, and an explosion of “high-frequency” protocols such as oracle or CLOB perp DEXs, Pyth’s low latency oracle product looks much better positioned to capture a significant amount of market share in comparison to competitors.

article-image

Monday developments reaffirmed the US as unfriendly to crypto while also offering a potential bullish outlook for segment firms, industry watchers say

article-image

It’s unclear what “actions” the CFTC, DOJ and Treasury will announce Tuesday afternoon

article-image

Some 18,000 accounts have already sent $27 million in crypto to a one-way bridge controlled by a Blast multisig

article-image

Telegram bots have seen a cumulative trading volume of over $4 billion

article-image

Avalanche has been inundated with transactions for inscriptions, similar to the Ordinals that already hit Bitcoin, Litecoin and Dogecoin

article-image

Like much of the tech world, crypto’s use of ChatGPT has been growing. Despite founder Sam Altman’s ouster, decentralized AI projects don’t seem ready to replace it