Meta’s ‘metaverse’ subsidiary, Reality Labs, reported an operating loss of $3.7 billion in the second quarter of 2023, as the company ramps up censorship on its platforms. Despite the ongoing troubles, Meta is “fully committed” to developing the metaverse.
Meta’s launch of Threads, a data-harvesting Twitter clone which compromises sensitive data including individuals’ biometrics, registered a 70% drop in active users following its early debut in July.
In brief
- Meta’s metaverse division Reality Labs posted $3.7 billion in losses in Q2 2023, per its latest earnings call.
- Meta CEO Mark Zuckerberg said the company still invests in the metaverse over the longer term.
- Meta reportedly hired an additional 1,000 censors following the recent riots in France.
- Increasing censorship on Meta platforms has led to speculation that the platform is thwarting open discussion at the behest of government dictates.
Meta’s metaverse-related division Reality Labs registered a $3.7 billion operating loss in Q2 2023, with the unit recording $276 million in revenue, down from $452 million in the same period last year, per Meta’s latest earnings results released Wednesday.
In an earnings call, CEO Mark Zuckerberg said, “as our investments in AI continue, we remain fully committed to the metaverse vision as well. We’ve been working on both of these two major priorities for many years in parallel now, and in many ways the two areas are overlapping and complementary.”
Meta’s chief financial officer, Susan Li, said Reality Labs’ expenses amounted to $4 billion in Q2, “up 23% due to lapping a reduction in Reality Labs loss reserves in Q2 of last year as well as growth in employee-related costs.”
The massive $3.7 billion loss came following a reported $4 billion loss the previous quarter, and a $2.8 billion loss in the same quarter the previous year.
Metaverse remains a focus
Despite the strikingly large losses, Zuckerberg said the company believes in both the metaverse and artificial intelligence, the latter of which has been all the rage recently.
“I’ve said on a number of these calls that the two technological waves that we’re riding are AI in the near term and the metaverse over the longer term,” he said.
Overall, Meta reported $7.79 billion in profits for the quarter, up 16% from the same period last year. Its revenue grew 11% year-on-year to $32 billion in the quarter.
Meta’s stock closed 1.39% higher on Wednesday and was up 6.89% in after-hours trading.
Meta censorship on the rise
However, Zuckerberg’s Meta has faced increasing criticisms from civil rights advocates which noticed how Meta platforms such as Facebook and Instagram are increasingly censoring content. The platform which once championed free speech employed another 1,000 censors following the recent riots in France.
Accusations of censorship have led to speculation that the platform is attempting to thwart open discussion of current events, potentially at the behest of governments like the European Union, Vietnam and elsewhere. Meta’s censorship regime is global.
In February 2022, venture capitalist, bitcoin advocate and libertarian Peter Thiel stepped down from the Meta board in pursuit of political exploits.
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