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Meta META, the American multinational technology conglomerate behind Facebook, Instagram, and WhatsApp, released its final quarterly and full-year financial results for 2022.
Although the company’s stock value increased by 17% after the release of the results, there’s something investors should bear in mind before investing in Meta: the losses of Reality Labs, its VR division.
This division produces virtual reality and augmented reality hardware and software, including virtual reality headsets such as Quest, and online platforms such as Horizon Worlds.
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What Happened?
The company led by Mark Zuckerberg confirmed a loss of over $4 billion in the last quarter of 2022 due to VR and metaverse development. Throughout the year, the company incurred a total loss of over $13 billion as a result of its unsuccessful attempt to create a popular metaverse, as per Kotaku.
Furthermore, Reality Labs generated a revenue of $727 million in the final months of 2022, a decrease of 17% compared to the division’s revenue in the same period of 2021.
It’s also worth noting that, in November 2022, Meta completed 11,000 employee layoffs, attributing them to a COVID-19, economic slowdown, intensified competition and reduction of advertising signals.
In the report, the company anticipated lower expenses than previously estimated in 2023 but didn’t clarify if it will reduce metaverse spending.
See also: Meta Attempts To Expand Its Metaverse’s User Coverage To Attract And Retain Users Versus Rivals
According to Gizmodo, in November Zuckerberg tried to assure investors that the company’s future income growth will come from WhatsApp and Messenger.
Price Action
Meta Platforms Inc was trading at $184.16 at the time of publication, down 3.89%.
Image credit: KVASVECTOR and Ground Picture on Shutterstock.
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Image and article originally from www.benzinga.com. Read the original article here.