Meta’s Reality Labs Suffers Major Losses
Meta, the tech giant previously known as Facebook, has recently faced a significant setback. Following a 10% reduction of Reality Labs’ workforce earlier this month, the company’s virtual reality (VR) sector, Meta has now revealed that the unit suffered considerable financial losses in 2025. According to reports, the layoffs could have impacted approximately 1,000 employees.
In a recent earnings report, Meta disclosed that Reality Labs lost a whopping $19.1 billion in 2025. This figure is slightly more significant than the losses incurred in 2024, which were around $17.7 billion. Furthermore, the unit reported a $6.2 billion loss for the fourth quarter of 2025 alone.
Reality Labs Sales vs Losses
Despite these staggering losses, Reality Labs managed to generate $955 million in sales for Q4 and an overall total of $2.2 billion for 2025. However, these figures fall far short of offsetting the unit’s substantial losses.
During Wednesday’s earnings call, Mark Zuckerberg, Meta’s CEO, displayed a hopeful outlook for the VR team. He anticipated that the losses for 2026 would mirror those of the previous year. He said, ” For Reality Labs, we are directing most of our investment towards glasses and wearables going forward, while focusing on making Horizon a massive success on Mobile and making VR a profitable ecosystem over the coming years.” He, however, acknowledged the continuation of losses and stated, “I expect Reality Labs losses this year to be similar to last year.” Zuckerberg also hinted at a gradual reduction in losses in the future.
The Future of Meta’s VR Venture
Meta’s pivot toward the “metaverse” in 2021 was met with skepticism. Despite the criticism and negative financial performance, Meta continues to invest in VR. However, with continuous losses and a shift towards AI, it remains unclear how the company plans to revive the struggling business.
Recent developments suggest a decreasing interest in VR from Meta. CNBC reported that, along with the recent layoffs, Meta has plans to close several of its VR studios. Additionally, the company announced the retirement of its standalone Workrooms app, a VR space initially designed for office meetings, indicating a further retreat from its VR ventures.
In conclusion, Meta’s VR unit, Reality Labs, has suffered significant financial losses. While the company’s CEO remains optimistic, the future of their VR projects remains uncertain. As the pivot continues towards AI and other technologies, the tech industry will be closely watching Meta’s next moves.
For more information, read the full report here.
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