Meta, led by Mark Zuckerberg, has incurred substantial losses in its metaverse ventures, totaling nearly $50 billion over the past five years.
This figure surpasses the market capitalization of prominent corporations such as Ford, Hershey, and Kraft Heinz.
An analysis of regulatory filings conducted by Insider revealed that Meta’s Reality Labs division has experienced a cumulative loss of $47 billion since the beginning of 2019.
This operating loss has steadily increased from just under $5 billion in 2019 to over $10 billion in 2021, nearly $14 billion in 2022, and surpassing $11 billion in the first nine months of 2023.
Meta, formerly known as Facebook, ventured into the metaverse by investing heavily in the development of a virtual world where people can interact with each other and digital objects in a more immersive way.
Excitement increased significantly in 2021 when Facebook rebranded as Meta. The name change was announced at the Facebook Connect augmented and virtual reality conference.
Metaverse is a virtual world where people can interact with each other and digital objects in a more immersive way.
Horizon Worlds is one of Meta’s metaverse projects. It is a virtual theme park, where users can hang out, chat with friends and strangers, play games, and attend concerts, game rooms, open mics, dance halls, bowling alleys, escape rooms, and more.
However, many of these places have been left for dead, and most venues are populated with only a single avatar.
Another project is Meta Adventure. Meta Adventure is an online multiplayer Play-To-Earn platform featuring exciting games.
The platform is part of Meta’s metaverse and is populated by NFTs that players can collect and use across different games.
Also, Meta created a new top-level product group focused on generative AI to turbocharge its AI research.
This was done as it believes that AI research will be critical to the development of the metaverse and is investing heavily in this area.
Zuckerberg and his team anticipate this trend to persist. In Meta’s third-quarter earnings report, they stated, “We expect our RL operating losses to increase meaningfully in 2024.”
These losses are largely attributed to extensive investments in long-term research and development for metaverse products, some of which may not fully materialize for a decade.
The metaverse market is a rapidly growing industry that is expected to revolutionize the way people interact with each other and digital objects.
It was worth approximately $83.9 billion in 2023 and is projected to grow at a Compound Annual Growth Rate (CAGR) of 45.2% during the forecast period (2022-2030).
Despite the financial losses experienced by Meta, it has also continued to make advances towards the virtual world. It recently unveiled Meta Quest 3 on October 10, 2023. The headset is available in two versions: 128GB and 256 GB.
Meta Quest 3 features a 4K+ Infinite Display, which achieves a nearly 30% leap in resolution compared to the Meta Quest 2.
It also has a mixed reality feature that allows users to seamlessly transition between a fully immersive experience and a blended environment with virtual elements overlaid on their physical surroundings.
