Meta suffered a nearly $4 billion loss from its metaverse unit with Reality Labs in what was otherwise a solid first quarter for the Mark Zuckerberg-led social media empire which posted a final profit of $5.7 billion.
While the $4 billion loss follows a $14 billion loss in 2022, Zuckerberg explained in the earnings report that Reality Labs will likely suffer more losses in the remainder of 2023.
โWe continue to expect Reality Labs operating losses to increase year-over-year in 2023,โ predicted Zuckerberg.
The losses suffered by Reality Labs were however negated by the firmโs developments in its artificial intelligence (AI) segment, the firmโs chief executive explained.
โOur AI work is driving good results across our apps and business. Weโre also becoming more efficient so we can build better products faster and put ourselves in a stronger position to deliver our long-term vision.โ
While Zuckerberg recently labeled AI as the firmโs โsingle largest investment,โ he said Metaโs metaverse ambitions remain a top priority for the firm.
โA narrative has developed that weโre somehow moving away from focusing on the metaverse vision, so I just want to say up front that thatโs not accurate.โ he said before adding, โweโve been focusing on both AI and the metaverse for years now and we will continue to focus on both.โ
In addition, Zuckerberg explained that metaverse tech will help its AI visions and vice versa.
โMetaverse technology will also help deliver AI as well. For example, embodying AI agents will take advantage of the deep investment that weโve made in Avatars over the last several years.โ
Related: Zuckerbergโs $100B metaverse gamble is โsuper-sized and terrifyingโ โ Shareholder
Zuckerberg explained in a Feb. 28 Facebook post that the firm is building a suite of creative and expressive tools that can help โturbochargeโ the efficiencies of some of its existing products:
โOver the longer term, weโll focus on developing AI personas that can help people in a variety of ways. Weโre exploring experiences with text (like chat in WhatsApp and Messenger), with images (like creative Instagram filters and ad formats), and with video and multi-modal experiences.โ
Though Zuckerberg stated the firm has โa lot of foundational work to doโ before it can provide โreally futuristic experiencesโ for its audience.
Meta stock bounced 11.7% after hours following the news of its better-than-expected first quarter, according to Google Finance:
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