Meta will slow down spending on long-term projects like its metaverse initiative in the face of slow revenue. CEO Mark Zuckerberg said a consistent, interconnected online world is still a few years away.
The company, formerly Facebook, said Wednesday first-quarter revenue grew 7% year-on-year, the slowest pace since the company went public in 2012. Meta was funded by high-income earnings during the pandemic, a slowdown causes a change in methodology.
“At our current level of growth, we now plan to slow the flow of some of our investments,” Zuckerberg said during the company’s earnings call.
Metaverse’s metaverse division, Reality Labs, saw its quarterly revenue jump from $ 534 million to $ 695 million year-over-year. However, the department still lost about $ 3 billion, up from $ 1.8 billion a year ago.
Tom Brannen, analyst at OnConvergence, said it’s a little disappointing to see Meta cut spending, but the company needs to balance its immediate health against its long-term goals.
“What we didn’t want to see was Zuckerberg driving that car off the cliff in the name of the metaverse,” he said.
Meta has expressed its ambitions to build metaverse and immersive technologies such as virtual reality and augmented reality to work with it. The company rebranded itself as Facebook last year to boost its focus on a metaverse economy that Constellation Research estimates could hit $ 21.7 trillion by 2030. However, Zuckerberg warned investors that it will take time to see a significant return on the money spent on Reality. Labs.
“[We’re] lays the groundwork for my anticipation of an exciting 2030, ”he said. “There are results down the road… but I think it’s a longer cycle.
Part of that standard would be a high-end VR headset for the company, according to Zuckerberg. Meta wants the headset, dubbed Project Cambria and due to launch later this year, to replace the employee’s work laptop. The headset has color video transmission from external cameras, so that it can attach digital elements to a worker’s real environment. Cambria also monitors users ’eyes and facial expressions to improve their immersion in the virtual environment.
The company is part of the corporate metaverse push. Last year, the company put a VR collaboration product, Horizon Workrooms, in beta. Workshops are rather a virtual meeting room where employees can interact.
Meta also wants to strengthen the user base of its metaverse platform, Horizon. The company will launch a web-based version of Horizon later this year, which will open up the platform to PC and mobile users. Currently, users can only access Horizon via a VR headset.
By opening up Horizon to PC and mobile users, Meta can expand the platform’s audience, according to Brannen. For example, Facebook users can hold virtual Horizon class meetings, give them a taste of the metaverse and encourage them to buy headsets to interact with the environment.
“For non -gamers, [Horizon] Maybe that’s how they got into the metaverse, ”Brannen said.
Meta is wise to take a long-term perspective on virtual reality, augmented reality and the metaverse, said Jeremy Bailenson, founding director of the Stanford University Virtual Human Interaction Lab.
“For decades … those thinking about VR space have boldly predicted that‘ next year ’will be big for VR,” he said. “What we’re seeing instead is a modest but steady increase every year … as opposed to a big turning point.”
Mike Gleason is a journalist who specializes in integrated communication and collaboration tools. He previously covered communities in the MetroWest region of Massachusetts for Milford Daily News, Walpole era, Sharon’s lawyer and Medfield Press. He also worked for newspapers in central Massachusetts and southwestern Vermont and served as local editor of Patch. He can be seen on Twitter at @MGleason_TT.