A follow-up to the Quest 2 virtual reality headset is arriving next year, Meta said in its most recent earnings announcement. The device will be a consumer-grade headset unlike the recently released Quest Pro, which costs $1,500 and comes with mixed-reality features designed to be useful in the workplace.
Meta snuck the detail into a paragraph concerning the ballooning costs of developing its vision for the metaverse. "Conversely, our growth in cost of revenue is expected to accelerate, driven by infrastructure-related expenses and, to a lesser extent, Reality Labs hardware costs driven by the launch of our next generation of our consumer Quest headset later next year," the company wrote.
Meta's AR and VR roadmap has been shifting of late, though the company has long hinted at an eventual successor to the Quest 2, which has sold an approximate 15 million units per estimates from industry tracker IDC.
For the quarter, the Reality Labs division, which includes AR and VR hardware as well as software platforms like Horizon Worlds, incurred a loss of $3.7 billion, up from $2.6 billion a year ago and increasing by nearly $1 billion from fiscal Q2. Those losses contributed to a more than $10 billion expenditure on the metaverse in Meta's last fiscal year, which ended in December. The costs are rising, too, though Meta says there is a light at the end of the tunnel as it plans beyond next year.
"We do anticipate that Reality Labs operating losses in 2023 will grow significantly year-over-year. Beyond 2023, we expect to pace Reality Labs investments such that we can achieve our goal of growing overall company operating income in the long run," the company wrote.
Brad Gerstner, CEO of activist investor Altimeter Capital, recently called on Meta to cut its head count and limit metaverse spending to $5 billion a year.
Climate TRACE's data show emissions at the facility-level.Image: Climate TRACE