According to its third quarter financial report released on Wednesday, Facebook’s parent company Meta stated that its metaverse branch Reality Labs lost US$3.7 billion in the third quarter of this year, bringing its total losses through 2022 to US$9.4 billion.
Reality Labs is a division of Meta that produces gear and software for virtual reality (VR) and augmented reality (AR), including virtual reality headsets Quest and online communities Horizon Worlds.
Revenue for Reality Labs decreased from US$558 million in the third quarter of 2021 to US$285 million in the third quarter. The company stated in its financial report that it anticipates Reality Labs’ operational deficit to increase dramatically in 2023.
According to Meta’s CFO David Wehner in the earnings statement, the division’s costs will increase led by infrastructure-related expenses and, to a lesser extent, Reality Labs hardware costs driven by the launch of our next iteration of our consumer Quest headset later next year.
The Quest Pro, The company’s most recent VR headset, was unveiled on October 11 and went on sale in Meta stores the following day. The metaverse platform’s user growth has fallen short of expectations.
According to leaked company documents, Horizon Worlds recently reduced its MAU target to 280,000 users, even though the company currently only has 200,000 users. Horizon Worlds had anticipated having 500,000 monthly active users (MAUs) by the end of the year.
To US$27 billion, Meta’s revenue decreased 4% from the second quarter. On Wednesday, Meta’s stock dropped 5.59% to end at US$129.82.