Meta (the company formerly known as Facebook) released its fourth-quarter earnings report today, which included year-end numbers for the fiscal year ended December 31, 2021.
Facebook only rebranded to Meta at the tail end of the year, but in that time period it abandoned the VR branding of Oculus, and bundled all its VR and AR projects under a division called “Reality Labs.” Developers in that division saw huge gains in 2021, as the company managed to double revenue for the division for the entire year.
In 2020, Reality Labs only pulled in $1.1 billion in revenue but in 2021, it managed to earn $2.3 billion–growth likely driven by the release of Quest 2.
VR and AR are still a loss-leading business for Meta though. The division posted an operating loss of $10 billion in 2021, an increase of 66 percent from 2020, when it only posted an operating loss of $6 billion.
That massive jump in expenditure likely can be viewed as a bit of a “can’t make an omelet without breaking a few eggs” situation. Increased spending on VR and AR is necessary for CEO Mark Zuckerberg’s vision of the metaverse to take off.
Those numbers are ultimately chump change to Meta, which raked in $117 billion in revenue in 2021, and posted a profit of $46.7 billion. It also earned $33 billion during the three-month period ending December 21, 2021, making $12 billion in the quarter.
These numbers still apparently fell short of investor expectations, causing the company’s stock to tank further than any of its numerous scandals did.