Ahead of the announcement of the financial statements for the fourth quarter of 2022, experts have estimated that the loss from Reality Labs will continue to increase sharply.
In an exchange last night January 31 was The Block narrated, CEO Meta Mark Zuckerberg did not hesitate to share about his ambition metaverse its "expensive" to analysts. Boss Meta said:
“We expect Reality Labs costs to increase significantly again in 2023. In the third quarter of 2022, the unit received a loss of $3.7 billion because of metaverse. This figure is expected to grow to $4.4 billion in the fourth quarter of 2022.”
Accordingly, the development and sales division of metaverse Reality Labs will likely continue to incur a loss of $ 3.7 billion in the last quarter of the fiscal year. This is similar to the loss the division faced in the previous quarter.
However, Zuckerberg still ignores public opinion and has not stopped "dreaming" of becoming an important player in the immersive digital world - as a combination of virtual, augmented and mixed reality. This same long-term plan could lead to a full year loss of $13.8 billion, FactSet forecast.
Although billionaire Zuckerberg has always been upfront and transparent about this huge metaverse cost, the latest earnings report is once again confusing for shareholders. Meta has lost more than $600 billion in value since the company's capitalization began to decline in late 2021.
Quoting a report published more than a month ago by analytics firm MoffettNathanson:
“Meta's initial outlook for 2023 operating expenses, losses from Reality Labs, and capital expenditures shared in its Q3 2022 earnings report indicates that the company's management is not warranted. benefits for shareholders.”
Still, the company predicts Reality Labs will lose $13 billion by 2022, still better than the average estimate.
On the other hand, advertising revenue - Meta's biggest "money printer" - continues to rake in tens of billions of dollars mainly thanks to the social networks Facebook and Instagram. After posting a profit of $114.9 billion on advertising in 2021, many analysts predict the company will pull in $113.1 billion in 2022. But due to a loss from Reality Labs, its 2022 earnings the company is expected to lose more than 16 billion USD, according to data from FactSet.
In addition, the sales of virtual-reality headsets is also a parameter that makes the community curious. At the end of last year, Meta opened for sale a new version of VR headset called Meta Quest Pro, priced at about $1,500/piece. Overall, VR headset sales in the US fell slightly in 2022, according to NPD Group.
Meta has been struggling to focus on developing the metaverse plan after changing the company name from October 2021. Since then, the Reality Labs division has continuously reported losses in the first, second and third quarters of 2022 with losses of $3 billion, $2.8 billion and $3.7 billion, respectively. The company also failed to meet the user count target for its flagship Horizon Worlds initiative.
Meta even cut thousands of employees, in an effort to cut operating costs, in November 2022. Even so, this giant still made significant strides in the reception aspect crypto, for example, integrating wallets and letting users post photos NFT.