Meta’s Metaverse Division Loses $2.8B in Q2

  • Mark Zuckerberg said that while Reality Labs had lost $2.8 billion in Q2, it had the potential to unlock “hundreds of billions of dollars” in revenue over time.
  • The same day, the U.S. FTC filed a lawsuit against Meta, alleging the company was trying to monopolize the entire metaverse market.
Facebook CEO Mark Zuckerberg

Meta CEO Mark Zuckerberg during press conference at VIVA Technology, Paris, France, May 24, 2018. Frederic Legrand/Shutterstock

The metaverse and virtual reality (VR) division of Facebook’s parent company, Meta, has lost the company around $2.8 billion during the second quarter of 2022, Meta said in an earnings report on 27 July.

According to the announcement, Meta’s Reality Labs not only lost the company almost $3 billion, but also generated a revenue of $452 million in the second quarter, which is down from the $695 million generated in Q1. The company’s CEO, Mark Zuckerberg, noted that the metaverse division will continue experiencing loses until its VR applications and metaverse platforms have matured enough. Zuckerberg said in a Q2 earnings call on Wednesday:

“The Metaverse is a massive opportunity for a number of reasons. I feel even more strongly now that developing these platforms will unlock hundreds of billions of dollars, if not, trillions over time. This is obviously a very expensive undertaking over the next several years. I’m confident that we’re going to be glad that we played an important role in building this.”

Launched in August 2020, Reality Labs is a division of Meta responsible for developing augmented reality (AR) and VR applications that help users connect over its various social platforms, as well as the metaverse. Meta is putting a lot of effort in developing Reality Labs — which has posted its seventh straight quarter of losses — with Zuckerberg saying during Meta’s Q1 earnings call that the division was “laying the groundwork for a very successful 2030s”.

The same day Meta released its Q2 earnings report, the U.S. Federal Trade Commission (FTC) filed a lawsuit against the company, alleging Meta was trying to monopolize the entire metaverse market. The government agency is looking to block the potential acquisition of VR firm Within, and its fitness app Supernatural, saying it would be illegal and that it would hinder “future innovation and competitive rivalry” among metaverse companies.

Related Coverage
Mysten Labs’ Layer 1 Blockchain Sui Launches on Mainnet
  • Sui Network was developed by Mysten Labs, which was founded by ex-Meta employees, using the Rust-based Move programming language.
  • Unlike other blockchains that use proof-of-work and proof-of-stake consensus mechanisms, Sui relies on delegated proof-of-stake that allows users to elect and vote for delegates.
May 3, 2023, 4:54 PM
Space Launch System Takes Off


Saudi Arabia Partners with The Sandbox on Metaverse Development
  • Metaverse gaming platform The Sandbox has signed a memorandum of understanding (MoU) with the Saudi Arabia Digital Government Authority.
  • The partnership will see The Sandbox and DGA “exploring, advising and supporting” each other on future metaverse projects.
Elrond to Focus on Metaverse Development, Rebrands as MultiversX
  • Blockchain developer Elrond is switching its focus to the metaverse, and in order to reflect that has now rebranded itself as MultiversX.
  • The company has also introduced three new metaverse products, which include a metaverse portal, digital assets holder, and a deployable blockchain module.