July 27, 2023 at 10:40 GMTModified date: July 27, 2023 at 10:42 GMT
July 27, 2023 at 10:40 GMT

Meta not letting go of Metaverse any time soon

In a recent earnings call, CEO and founder of Meta, Mark Zuckerberg, revealed his company’s continued commitment to the Metaverse.

Meta not letting go of Metaverse any time soon

In a recent earnings call, CEO and founder of Meta, Mark Zuckerberg, revealed his company’s continued commitment for Metaverse.

Questions had been raised about the same in the background of Meta’s investments and increased interest towards artificial intelligence (AI).

Talking about Meta’s interests, he said: “Our investments in AI continue. We remain fully committed to the Metaverse vision as well. We’ve been working on both of these two major priorities for many years in parallel now, and in many ways the two areas are overlapping and complementary.”

Following the inception of Meta’s Metaverse initiative, the social media giant has continued to lose billions of dollars as it failed to be profitable. According to its February earnings release, it lost massive amounts of money in its Facebook Reality Labs (FRL) division. This comprises the Facebook parent’s augmented and virtual reality operations.

On top of this, for the whole of 2022, Meta lost $13.7billion in the division on revenue of $2.2bn. This was noted to be up from a loss of $10.2bn on revenue of $2.3bn in 2021.

However, the company made public its decision to hold on to this sector, expecting FRL’s operating losses in 2023 to grow “significantly” over 2022. This is because Meta believes to be investing in what it sees as a crucial part of its future.

On the same lines, Zuckerberg continued: “This is an ambitious long-term horizon, multi-faceted roadmap. There are lots of components to the Reality Labs portfolio across VR, AR, Metaverse, social platforms, neural interfaces, and we really have a long-term time horizon for evaluating the return on our investments here. I can’t guarantee you that I’m going to be right about this bet. I do think that this is the direction that the world is going in.”

On the flip side, Meta enjoyed a fiscal second-quarter net income of $7.79bn which was up from $6.7bn in the previous year. Its revenue also climbed 11% to $32bn, as revealed in its most recent earnings.

There was also an increase of 5% and 7% in the daily active users for Facebook and Meta’s family of apps, including Instagram, respectively. However, its recently introduced app ‘Threads’, which was launched as a competitor for Twitter, experienced a 60% drop in active users from its launch week.

Threads’ inception was met with much acceptance initially as its usage peaked immediately after its launch, on 7 July, with more than 49 million daily active users on Android alone. However, by 23 July, that had fallen to 12.6 million daily active users.

According to a report from Similarweb, the average amount of time active Threads users spent on the app also dropped. Android users in the U.S. spent nearly 21 minutes per day on the app immediately after its launch, but the same figure went down to less than 5 minutes per day. On the other hand, Twitter users consistently engaged with the app for about 25 minutes per day.

At the time of press, Meta’s stock was up by over 4% daily, trading just below $300, with a market capitalisation of $765bn.

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