Meta platforms had a poor outing in the second quarter of this year. It is the first time since its inception that the social media behemoth saw a massive income drop.
Recent Reality Labs Loss
The company published an announcement Thursday where it stated that its Reality Labs saw a quarterly loss of $2.81 billion. The arm of the company, thus, has incurred a year-to-date loss of $5.78 billion.
Meta’s CEO, Mark Zuckerberg, said metaverse is a huge opportunity for many reasons. He emphasized that setting up platforms in the digital space will generate trillions of dollars.
Zuckerberg went further to state that Meta will keep putting more emphasis on metaverse development. He said the company will continue to ride on technological waves for a long time to come.
Facebook earned a revenue of about $29.08 billion in the second quarter of 2021. This is in spite of the concerns around cross-app tracking. It was the first time that Meta made losses since it began operation.
The metaverse and virtual reality ventures are rapidly getting more expensive for Meta. It allocated a sum of $2.8 billion to its Reality Labs in the second quarter. It was a sign of the company’s ambition into the virtual space that goes beyond mere marketing.
More Focus on the Long-Term
Facebook Reality Labs is a completely different entity from Facebook, Instagram, WhatsApp, and Messenger. It is focused on developing the operating system, content, and hardware for the tech company. This will aid the company’s push into the virtual space.
In spite of its latest loss, its investment in Reality Labs is a major financial commitment. It has some short-term benefits where a long of huge tech firms have cut down their R&D budgets recently.
Facebook Reality Labs recorded a sales figure of $452 million in the second quarter of this year. It was a 35% shortfall from what it earned in the first quarter. The arm of the company had a staggering loss of $10.2 billion in 2021.
There are projections that it will record more losses by the end of this year. Zuckerberg has clarified that the company is more focused on long-term metaverse growth. The focus will be less on short-term increases through monetization.
In his words, these platforms have the potential of generating hundreds of billions over time. If not trillions of dollars.