The company plans to lay off 20,000 employees worldwide amid financial hardship.

The division responsible for augmented and virtual reality products within Meta Platforms announced in late October an operating loss of 3.74 billion dollars for Quarter 3 and 210 million dollars in revenue. 

Throughout the fiscal year ending on September 30, 2023, Reality Labs - formerly Oculus - has accumulated losses of $11.4 billion during the nine months of 2023, while only generating $825 million in revenue. Of that revenue, a mere $210 million was earned during Q3, representing a 20% decline compared to the previous year, the financial report states.

Meta attributed this decline to lower Quest 2 sales.

Meta's CFO Susan Li, commented on the division's current status, said that the company anticipated a substantial year-over-year increase in losses due to ongoing investments in augmented reality and virtual reality product development, and ecosystem expansion.

Li elaborated that a majority of the costs incurred by Reality Labs are related to headcount, operational expenses, and product costs. Meta’s investments in this sector will continue, she stressed.

This poor performance is directly related to Meta’s ambitious pursuit of creating a metaverse at Reality Labs over the last quarter – a project that many experts now think of as a dead point as companies plunged into artificial intelligence, the new big thing.

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The financial problems are behind Meta’s plans to lay off more than 20,000 jobs in the near future. In Quarter 3, it cut 7% of jobs, ending the financial year with around 66,100 employees.

Meta CEO Mark Zuckerberg has promised that the company will actually ramp up recruitment in the short term as game studious have lost valuable human capital and experience. He issued no concrete dates or numbers yet.

As of today, 7 November, Meta share price stood at 315.8 dollars, compared to just around 100 dollars in early 2023. 

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