Mark Zuckerberg's company, Meta, has accumulated nearly $50 billion in losses in the metaverse industry over the past five years. These losses far surpass the market values of several well-known companies and the fortunes of some of the world's wealthiest individuals.
Meta, the owner of Facebook, Instagram, and WhatsApp, has reported a total loss of $47 billion in its Reality Labs division since the beginning of 2019, according to an analysis of regulatory filings. The division's operating loss has increased from under $5 billion in 2019 to over $10 billion in 2021, nearly $14 billion in 2022, and more than $11 billion in the first nine months of this year.
Furthermore, Meta expects these losses to continue growing. In their third-quarter earnings report, Zuckerberg and his team stated that they anticipate "meaningfully" increasing operating losses in the RL division in 2024 due to long-term research and development investments for metaverse products.
Meta's metaverse losses already surpass the market capitalization of companies such as Ford, Hershey, and Kraft Heinz. They could soon overtake the market values of Lululemon, Chipotle, Target, and Monster Beverage.
If Meta's losses were an individual's net worth, they would rank among the top 25 billionaires on the Bloomberg Billionaires Index, surpassing the net worth of notable figures like Phil Knight, Jensen Huang, and Ken Griffin.
However, it's important to note that the metaverse business is still a small part of Meta overall. The company's main "Family of Apps" division generated $94 billion in revenue and $42 billion in operating profit in the nine months to September, compared to less than $1 billion in revenue and an $11.5 billion loss in the RL business. As a result, Meta still generated over $30 billion in total operating income during that period.
While Zuckerberg has been a vocal supporter of virtual reality, augmented reality, and the metaverse, it remains uncertain whether his big bet on this industry will pay off. Nevertheless, Meta's significant losses in the metaverse space are noteworthy and are expected to continue growing in the coming years.