Meta’s title division has just suffered another blow
The social media giant announced this afternoon that its metaverse-specific division suffered losses of $ 2.81 billion this quarter. As a result, the division’s losses since the beginning of the year amount to a staggering 5.77 billion US dollars.
The department, Facebook Reality Labs (FRL), is different from Facebook, Instagram, Messenger and Whatsapp and focuses on development the hardware, software, and content that are central to Meta’s foray into the metaverse.
In its second quarter 2022 earnings report, FRL generated revenue of $452 million during the period, down 35% from the previous quarter. Last year, the division posted a staggering annual loss of $10.2 billion. It is currently on track to surpass that number in 2022.
“Of course, this is a very costly undertaking for the next few years,” admits Meta CEO Mark Zuckerberg. “But as the metaverse becomes more and more important in every part of our lives … I am confident that we will be glad that we played an important role in the construction.”
When Zuckerberg changed the name from Facebook to Meta last fall, he refocused the entire company’s ethos on mastering the metaverse: an immersive, future version of the internet navigated by digital avatars, which Zuckerberg relies on, will become the center of commerce, work, entertainment and social interaction.
Although the company’s multibillion-dollar metaverse game has yet to pay off, Zuckerberg this afternoon tried to convince shareholders that it’s a smart long-term game. Strategy acts.
“By helping to develop these platforms, we have the freedom to shape these experiences the way we and the entire industry believe they will be best are, rather than being constrained by the restrictions that competitors impose on us,” Zuckerberg said. “I am now even more convinced that the development of these platforms will unlock hundreds of billions of dollars, if not trillions, over time.”
The company’s total revenue improved just over 3% to $28.8 billion this quarter. Still, the company’s stock fell about 4% to $163.81 at the time of writing this article following the release of the second-quarter earnings report in after-hours trading.