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In their quarterly earnings report for Q4 2024, Meta actually has a lot to be proud of in the VR arena. Thanks to the Meta Quest 3, their newest headset that commands at least half of the consumer VR gaming market, the company generated $1.1 billion in sales in their Reality Labs department during the fourth quarter. This would be a lot to brag about if it weren’t offset by $4.97 billion in losses.
The losses largely come from continued R&D into Meta’s Metaverse project, an all-encompassing alternate reality that acts as a virtual social space for the world. In their quarterly earnings call, Meta CEO Mark Zuckerberg brushed past the losses to focus on the Metaverse as a concept.
“This is also going to be a pivotal year for the metaverse,” Zuckerberg told investors.
For game developers, this means that it is likely Meta is going to continue investing into their VR hardware as they continue investing more and more into the Metaverse, with the former being their stepping stool into the latter. Hardware updates will probably keep pace with market needs, making it unlikely for the Meta Quest to fall out of favor with the VR gaming public.
A recent survey of game developers shows that most developers making VR games are making them for the Meta Quest. Whether they have any intention of supporting the Metaverse or not, Meta’s losses indicate a stubborn desire to stay in the arena and ensure it pays off rather than the opposite. Perhaps counterintuitively, these losses are a good sign for developers looking for long-term commitment to VR.
Apple is rumored to be working on a more consumer-friendly version of their Vision Pro headset and both Google and Samsung have announced in recent months their own intentions to enter the market. While Meta does not need to fear the market becoming unviable for them, there is a concern that new competitors may rise in consumer VR in coming years.
