- Meta’s Reality Labs lost $4.2 billion in Q1 while bringing in just $412 million in revenue.
- The division has now lost over $60 billion since 2020, with no clear timeline for profits.
- Meta laid off Oculus Studios staff as it shifts focus to future mixed reality experiences.
Meta’s still pouring cash into the metaverse… like, a lot of cash.
In its latest Q1 earnings report, the company revealed that its Reality Labs division lost $4.2 billion—in just one quarter. Revenue? A modest $412 million. That’s slightly better than Wall Street expected, but not by much. Analysts had projected a bigger $4.6 billion loss on $492.7 million in sales. So yeah, the bleeding continues.
Reality Labs is the part of Meta behind all things VR and AR, like the Quest headsets and those Ray-Ban smart glasses you may or may not have seen someone actually wear in public. It’s also the core of Zuckerberg’s grand vision for a future built around virtual spaces and digital worlds. But so far, the financials? Not so dreamy.
$60 Billion Lost… and Counting
Since late 2020, Reality Labs has racked up more than $60 billion in losses. Last year alone, it burned through nearly $4 billion in Q1. And don’t forget—this is the unit that prompted Mark Zuckerberg to rebrand the whole company from Facebook to Meta back in 2021.
Investors have been side-eyeing these massive bets for a while now. Zuckerberg keeps saying this is a long game—that the metaverse won’t pay off overnight. But with more headwinds coming, including Trump’s new tariffs that could jack up production costs, even Meta’s diehards are getting nervous. Higher costs could mean higher prices for its already pricey gadgets.
Layoffs Hit Reality Labs
Oh, and there were layoffs. Meta confirmed last week that it cut staff within its Oculus Studios unit, the team responsible for building VR and AR games for Quest devices.
“Some teams within Oculus Studios are undergoing shifts in structure and roles,” a spokesperson said, adding that the changes are meant to help the group work more efficiently and focus on future mixed reality projects. Translation: we’re trimming now and hoping it pays off later.
