The Metaverse is losing billions to Facebook, but Zuckerberg still believes in it

The latest financial results of the Meta Group, better than expected, reveal a new loss of 3.99 billion dollars for the division in charge of the metaverse and virtual reality. Not enough to worry Mark Zuckerberg, who remains convinced that he is right.

In 10 years, will Mark Zuckerberg be able to say he was right?

By announcing to bet everything on the metaverse and by renaming his company Meta at the end of 2021, the creator of Facebook has succeeded in a huge communication operation. For more than six months, the entire industry talked about the metaverse, often to say nothing. The scandals in which Facebook had become entangled then seemed behind him, so much so that many wondered about the real motivations of Mark Zuckerberg. Did he really believe in the metaverse, or did he play with the naivety of the observers, to divert attention?

The more time passes, the more Mark Zuckerberg suggests that his motives were sincere. No one is interested in the metaverse anymore, his Quest Pro helmet had a huge flop, which forced him to cut prices, but the boss of Meta remains convinced that he is just ahead of his time. He may be right, but Meta can’t lose money forever.

The financial pit of the metaverse, saved by the good results elsewhere

In the first quarter of 2023, Meta had a revenue of $28.6 billion. This is more than in the same quarter of last year, which reassured investors about its good financial health. Meta was also pleased to have passed the milestone of 2 billion daily users of the Facebook application, which is proof that its historical social network is not so much in decline. The only black note concerns the group’s profits, of 5.7 billion dollars, or 24% less than a year ago.

Without the metaverse, Meta’s profit would have been significantly greater. The Reality Labs division, in charge of everything related to virtual, mixed, and augmented reality, alone lost $3.99 billion. This is because headset sales are too small to make money today, while Reality Labs invests heavily in research and development. It’s a money pit for Meta, even though his boss hopes that all these years of research will eventually pay off. It’s obvious that Meta has a great lead in VR today, but now it needs to convince the public of its usefulness.

The Meta Quest Pro headset is great for work and play, but Meta prefers to communicate on its Metaverse.

Even though Meta is in what Mark Zuckerberg calls “the year of efficiency” (you have to understand the year of cost-cutting, with lots of layoffs and fewer wacky projects ), the billionaire refuses to admit that the concept of the metaverse does not take. Meta plans to continue funding its Reality Labs division, even though it costs it billions every quarter. Mark Zuckerberg notably indicated that the rumors according to which Meta would like to invest less in the metaverse were “not accurate”.

Next quarter, Meta could be helped by Apple, which is expected to announce its mixed-reality headset on June 5. If the creator of the iPhone finds the right marketing formula, maybe it will help Meta boost its sales. Otherwise, Meta risks continuing to lose money.

Facebook’s ChatGPT, soon available to “billions of people”?

Even if the metaverse is its future, Meta does not intend to miss the revolution of artificial intelligence generators, ChatGPT style. During his call with investors, Mark Zuckerberg explained that he sees “an opportunity to bring conversational AI to billions of people in a way that will be useful and meaningful” in the coming months.

“We are exploring chat experiences in WhatsApp and Messenger, visual creation tools for Facebook and Instagram posts and ads, and over time video experiences,” says Mark Zuckerberg, who also imagines the metaverse as a good where a Jarvis-style AI could prove revolutionary. Meta admits he fell behind at first, but Mark Zuckerberg swears he’s caught up now. AI with Facebook sauce is coming!