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Meta’s Reality Labs division has reported another multi-billion-dollar loss as it continues to develop virtual and augmented reality technologies for its metaverse vision.
According to a recent report, the company disclosed a $4.97 billion operating loss, despite generating $1.1 billion in sales.
Following the announcement, Business Insider revealed an internal memo from Meta’s CTO, Andrew “Boz” Bosworth, addressed to employees.
In the memo, Bosworth described 2025 as a crucial year for the company’s metaverse strategy. “This year likely determines whether this entire effort will go down as the work of visionaries or a legendary misadventure,” he stated.
Meta has been pushing its metaverse ambitions since rebranding from Facebook in 2021. The company has invested heavily in technologies like its Meta Quest VR headsets and “Orion” augmented reality glasses. However, sales have struggled to gain momentum.
In 2023, Reality Labs reported a $4.5 billion loss during the second quarter. Despite generating over $1 billion in sales in the fourth quarter, the division still faced a $4.65 billion operating loss.
The VR market presented additional challenges, with a nearly 40% decline in headset sales by the end of that year.
In response to mounting losses, Meta restructured Reality Labs in June 2024, splitting it into two units: Metaverse and Wearables. This reorganization led to leadership cuts, marking the most significant structural change since 2020.
The company has also made strategic adjustments to refocus its efforts. One notable decision was the discontinuation of its Workplace app.
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