In the fiscal Q4 report, Meta revealed that its VR division lost $3.3 billion. The figure was disclosed to demonstrate the company's serious intentions about the Metaverse.
On Wednesday, Meta, formerly known as Facebook, reported its fiscal Q4 results, for the first time disclosing the financials of Meta Reality Labs – virtual reality division entrusted with building CEO Mark Zuckerberg’s vision for the metaverse.
According to the report, Reality Labs, which is tasked with R&D for AR/VR apps and hardware business including the sales of Oculus products, generated $877 million in revenue compared to $717 million a year before. However, it was reported that the division showed an operating loss of $3.3 billion while a year earlier that loss amounted to $2.09 billion in the fourth quarter.
The loss of $3.3 billion includes overall costs invested in the development of the Metaverse and further software and hardware including the Meta Quest 2. Zuckerberg revealed those numbers to demonstrate the company's serious intentions about its metaverse – the universe of interconnected digital worlds that the company calls "the next evolution of social connection".
In a statement, Zuckerberg noted: “In October, we announced that 'Meta' would be our new name and laid out our vision for the metaverse. When we shared our plans at Connect, I said this is not something we’re going to do on our own. The metaverse will be built by creators and developers, it will be interoperable, and it will touch many different parts of the economy."
Apparently, Q4 was a climax for sales of Meta Quest 2 headsets and the consequent development of games and apps. And as Meta generated total revenue of $32.8 billion for the fourth quarter including its income from Facebook and Instagram, it seems that the company has enough opportunities to invest in its metaverse.
According to the chief financial officer at Meta David Wehner, the company expects 2022 capital expenditures to be in the range of $29 billion to $34 billion, which is the same as the company’s prior estimate. “As we discussed previously, this range reflects a significant increase in our artificial intelligence and machine learning investments, which will support a number of areas across our Family of Apps," he said, "While our Reality Labs products and services may require more infrastructure capacity in the future, they do not require substantial capacity today and, as a result, are not a significant driver of 2022 capital expenditures.”
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