While the social media giant beat analyst expectations with its fourth-quarter results — shares jumped after hours — its metaverse Reality Labs division posted a loss of $13.7 billion for 2022, compared with a loss of $10.2 billion in 2021.
It also posted a loss of $4.3 billion for the fourth quarter, its worst since the fourth quarter of 2020. The company began reporting division results during the fourth quarter of 2021.
Despite Reality Labs’ lagging performance, Zuckerberg said on Meta’s fourth-quarter earnings call that investing in the metaverse remains a top priority.
“Our priorities haven’t changed since last year,” Zuckerberg said.
He hailed the company’s release of the Quest Pro headset as a win, and touted a next-generation consumer headset to be released next year as technology that will become, in his words, “the baseline for all headsets.” in the future”.
Zuckerberg also said the company will focus more on mixed reality, which differs from virtual reality because it mixes physical and digital elements. The company’s Quest Pro headset already incorporates the technology, and its new consumer headset will do the same.
“The MR (mixed reality) ecosystem is relatively new, but I think it’s going to grow a lot over the next few years,” Zuckerberg said.
In the earnings call, Meta’s CEO also said 100 million people have already created avatars in WhatsApp after the company rolled out the feature in December. He suggested that introducing features like avatars on mobile devices could draw more people to the company’s metaverse products.
“Most people will experience the metaverse for the first time on phones and start building their digital identities through our apps,” he added.
Despite Reality Labs’ lackluster performance, shares of Meta jumped 19% after hours to $181 from Wednesday’s close of $153. Along with revenue of $32.2 billion, which beat expectations, it also announced a $40 billion share buyback.
The company’s shares plunged nearly 62% in 2022 as the company reported its first drop in revenue since it went public in 2012. Zuckerberg billed 2023 as the “year of efficiency” and said he is busy on Wednesday removing barriers in middle management to make faster decisions. The company cut 11,000 employees in November.
“I think a lot about what we do,” Zuckerberg said, “it really makes sense to focus on efficiency a lot more than we previously had.”