Meta burns another $4.5B on metaverse in Q2, preps for AI growth ...
Meta Platforms, previously known as Facebook, continued its financial struggles in the metaverse, recording a $4.5 billion loss in the second quarter of this year. This contributed to a cumulative loss of nearly $60 billion since the inception of its metaverse business in 2019. Despite this setback, Meta reported a revenue of $49 billion for Q2, marking a 22% increase from the previous year and its second-largest quarter to date.
AI Advancements and Profitability
Meta's profitability was buoyed by its advancements in artificial intelligence (AI) and the growth of popular apps such as Threads and WhatsApp. The company posted a substantial profit of $13.5 billion, a significant portion of which was attributed to its AI initiatives. Meta's CEO, Mark Zuckerberg, expressed optimism about the future of Meta AI, aiming for it to become the most widely used AI assistant globally by 2024.
The successful launch of the Ray-Ban Meta smart glasses, integrated with AI technology, also contributed to the positive financial results. The company's shares surged by 7.1% in after-hours trading following the earnings call, surpassing analyst expectations.
Focus on AI and Metaverse Development
Looking ahead, Meta outlined its plans to ramp up capital expenditure in 2025, particularly focusing on AI research and development. Despite the prevailing perception of Facebook as a platform for older users, Meta's CFO, Susan Li, highlighted the increasing engagement of younger users on Facebook Marketplace.
The company's metaverse research division, Reality Labs, responsible for VR innovations like the Meta Quest 3, reported $353 million in Q2 sales. However, Reality Labs also suffered a substantial loss of $4.5 billion, contributing to the overall financial burden on Meta. Li emphasized the ongoing investments in augmented reality and virtual reality technologies, anticipating further losses in the coming year due to continued product development efforts.
Meta remains committed to enhancing the metaverse ecosystem through sustained investments and advancements in AI technologies, despite the financial challenges posed by its metaverse pursuits.
For more information, you can visit Meta's official website here.
