Shulou(Shulou.com)11/24 Report--

On Wednesday, Meta, Facebook's parent company, released its fourth-quarter earnings report, in which Reality Labs, which is responsible for virtual reality and meta-universe-related projects, lost $4.28 billion in Q4 operations and a total operating loss of $13.72 billion for the whole year, both expanding year-on-year.

Last year was a tough year for Meta, which changed its name. In the second half of 2021, Zuckerberg decided to change the company's name from Facebook (one of its four social platforms) to Meta ("meta" of the meta-universe). He believes that the future will be the world of the meta-universe, in which people can work, shop, play or learn knowledge.

But for now, at least, Meta Strategy and Reality Lab is Meta's "burn center," investing in black holes without profit. Meta is still an online advertising company.

In Q4 last year, the Reality Lab division had revenue of $727 million and total revenue of $2.16 billion for the year, down year-on-year; an important source of revenue was sales of the Quest series of virtual reality headsets.

Reality Lab lost more than six times its total sales revenue last year. This division accounts for only about 2% of Meta's company-wide revenue.

Wall Street analysts had forecast Meta's Reality Lab division to have revenue of $715 million and an operating loss of $4.36 billion last year. The division performed slightly better than analysts expected.

Meta's sales of virtual reality hardware fell 2% by early December compared with the same period in 2021, according to NPD Group, a US technology market research firm.

Last July, Meta announced that the price of Qest 2 virtual reality hardware would rise by $100. The company explained that inflation in the United States caused costs to rise.

Last October, Meta released a new, more expensive Quest Pro headset, priced at up to $1500, but not for consumers, but for corporate employees to wear at work.

Meta launched a big promotion this week for high-end virtual reality headsets, cutting prices by $400 for a specific period.

Last summer, Zuckerberg said he expected 1 billion people to live in the meta-universe between 2025 and 2030, and each of these users could spend hundreds of dollars shopping in the meta-universe.

At the heart of the Meta Universe concept is a new generation of virtual reality and augmented reality technology. Meta still needs billions of dollars in continuous research and development before the meta-universe dream becomes a reality.

Meta also warned last year that operating losses at the Reality Lab division were expected to rise sharply year-on-year in 2023. However, after 2023, the company will appropriately control the investment amount of the real lab business unit in order to achieve the operating profit growth target of the whole company in the long run.

Zuckerberg's meta-cosmic dream didn't interest Wall Street investors much. Meta's share price evaporated by two-thirds last year for a variety of reasons, including a sharp rise in Meta's money-burning scale, a weak online advertising market due to the U.S. macro economy, increasing competition from Short Video giant TikTok, and Apple's new privacy policy weakening Meta's advertising targeting ability.

Meta's fourth-quarter earnings beat Wall Street analysts 'expectations Wednesday and the company announced a $40 billion share buyback program, sending its shares up 17% in after-hours trading.

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