Advertisement

Meta first-quarter earnings show sales bump, operating loss for Reality Labs

Meta Platforms released its financial results for the first quarter of 2023, which included a bump in sales revenue, following three straight declines, and a $3.99 billion operating loss for Meta’s Reality Labs. File Photo by Terry Schmitt/UPI
1 of 3 | Meta Platforms released its financial results for the first quarter of 2023, which included a bump in sales revenue, following three straight declines, and a $3.99 billion operating loss for Meta’s Reality Labs. File Photo by Terry Schmitt/UPI | License Photo

April 26 (UPI) -- Meta Platforms released its financial results for the first quarter of 2023, which included a bump in sales revenue, following three straight declines, and a $3.99 billion operating loss for Meta's Reality Labs after the unit lost $13.72 billion last year.

Meta shares rose 12% in after-hours trading Wednesday on news of the better-than-expected results, despite poorer numbers for Meta's Reality Labs.

Advertisement

Meta's Reality Labs, which builds virtual and augmented reality technologies for the metaverse, generated $339 million in revenue during the first quarter despite billions in advertising revenue.

"We had a good quarter and our community continues to grow," said Meta chief executive officer Mark Zuckerberg.

"Our AI work is driving good results across our apps and business. We're also becoming more efficient so we can build better products faster and put ourselves in a stronger position to deliver our long term vision," he said.

As Zuckerberg pumps more money into and racks up more losses in metaverse, the company is in cost-cutting mode in other divisions as ad revenue slows.

Calling 2023 the "year of efficiency," Zuckerberg has initiated a number of cost-cutting measures which include layoffs that are expected to hit some 21,000 employees.

Advertisement

"As of March 31, 2023, we have substantially completed the 2022 employee layoffs while continuing to assess facilities consolidation and data center restructuring initiatives," Meta said Wednesday in its quarterly report.

"In March 2023, we announced three rounds of planned layoffs to further reduce our company size by approximately 10,000 employees across the Family of Apps and Reality Labs segments."

The company previously announced that it would lay off 11,000 employees in November after Zuckerberg admitted increased investments in the company had not paid off.

"Not only has online commerce returned to prior trends, but the macroeconomic downturn, increased competition and ads signal loss have caused our revenue to be much lower than I'd expected," Zuckerberg said last month.

Meta, which changed its name from Facebook in 2021, has seen sales of its virtual reality headsets decline 2% year over year as of December.

Last month, Meta slashed the price of its Quest Pro VR headset by a third, from $1,500 to $1,000.

Latest Headlines