Zuckerberg Lost $10 Billion On His ‘Metaverse’ In 2021
In late October of 2021, Facebook CEO announced the transformation of his company to “Meta” which is what the company is called now. Part of the transformation included a blueprint of Facebook turning into a “metaverse”, where users can essentially interact with each other in a setting of a virtual world. The concept of a metaverse has been growing more popular since this announcement, but the financial implications of this drastic shift are also becoming more apparent.
The Reality Labs division of Meta for 2021 released its financial report recently and showed an astounding $10.19 billion in losses. This is a crazy number, but does not seem to necessarily phase Zuckerberg and Meta, as these kinds of amounts seemed largely expected as an overhead for the vision the company has for their metaverse. In fact, Meta’s CFO went as far as to say that these losses are expected to be far more significant in Reality Labs for 2022 and that it is all part of the plan.
One thing that does seem mysterious about the extent of these losses is the fact that many of Meta’s rivals, which are also experimenting with the idea of a metaverse, are not even losing half of what Meta is. Alphabet, Google’s parent company, for example, lost $1.45 billion in the 4th quarter in comparison to Meta’s $3.3 billion in that time. Much of the specifics of Meta’s blueprint are relatively secret as of now, so it remains unclear as to what exactly the money is going towards.
It is also possible that Meta is simply speeding up the rates of their investment towards the metaverse in comparison to its competition, as it wants to get ahead of the rest of the field. Either way, it seems as if Zuckerberg and his team have things under control, and it will be interesting to see what comes out of his vision.
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