“This is obviously a awfully expensive enterprise over following many years,” said Mark Zuckerberg.
Meta’s virtual reality (VR) and metaverse division Reality Labs has posted its seventh straight quarter of losses, but CEO Mark Zuckerberg remains steadfast in investment within the technology, that he calls a "massive chance.
During Meta’s Q2 earnings invoke call on 27, Zuckerberg acknowledged that such losses might continue for many additional years till VR applications and its Metaverse platform are mature enough to faucet into the “massive opportunity” value “hundreds of billions of dollars”
“The Metaverse is a massive opportunity for a number of reasons. I feel even more strongly now that developing these platforms will unlock hundreds of billions of dollars, if not, trillions over time.”
“This is obviously undertaking expensive undertaking over ensuing many years,” Zuckerberg another, “I’m assured that we tend to’re going to be glad that we played a crucial role in building this.”
The extended stretch of operating losses for Reality Labs was revealed in Meta’s Q2 financial statement earlier in the day. Such losses aren't unusual for divisions in a analysis and development part.
Reality Labs builds VR and increased reality (AR) applications to assist Meta users connect over its various social platforms, together with the Metaverse, with the oculus line of VR headsets.
In addition to the losses, Reality Lab’s revenue has been trending down since 2021 and its operational margin has been trending down since 2020. The $11.1 billion in revenue and 29% margin denote in Q2 2022 are rock bottom over the past seven quarters.
Reality Labs denote $2.9 billion in losses for Q1.
Zuckerberg also noted that a “challenging macro environment” could be exacerbating the losses.
He aforesaid that the economic scenario now could be worse than it was a quarter past, and his opinion is substantiated by the actual fact that the federal reserve raised interest rates by 0.75 proportion points for the second time in an exceedingly row on July 27 before the Meta earnings decision took place, adding:
“We seem to have entered an economic downturn that will have a broad impact on the digital advertising business. In this environment, we’re focused on making a long term investment that will position us to come out stronger.”
Despite the economic troubles, Zuckerberg is confident that his company and its subsidiaries can start up of the present economic downturn as “a stronger and a lot of disciplined organization.”
He attributed this confidence to the investments his company is making currently to confirm it's able to stay a leader in an business which will be undergoing a shift to accommodate a lot of Metaverse platforms.
( Brian Newar, Cointelegraph, 2022 )