Meta's VR division revenue down 26% in Q3

The firm's net income jumped by 164%, Zuckerberg said it was a good quarter for its community and business

News by Jeffrey Rousseau Staff Writer

Published on Oct. 26, 2023

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Meta released its financial results for the three months that ended September 30, with its VR division performing at a loss. Here's what you need to know:

The numbers three months ending September 30:

Revenue: $34 billion (up 23% year-on-year)
Net income: $11.6 billion (up 164% year-on-year)

Reality Labs:

Revenue: $210 million (down 26% year-on-year)
Three-month operating loss of $3.74 billion, compared to $3.67 billion in same quarter last year

The numbers nine months ending September 30:

Revenue: $95 billion (up 12% year-on-year)
Net income: $25 billion (up 35% year-on-year)

Reality Labs:

Revenue: $825 million (down 42% year-on-year)
Nine-month operating loss of $11.5 billion, compared to $9.44 billion loss in same quarter last year

The highlights:

Meta may have done well overall in the third quarter, but the AR/VR division Reality Labs continues to be a drag on the company.

With Reality Labs operating losses already at $11.5 billion through the first nine months of the year and 22% deeper than at the comparable point of 2022, it's not surprising the company said it expects the division to finish the year with a worse bottom line than last year.

However, Meta is not backing down off its VR/AR ambitions, as the company said it expects Reality Labs operating losses in 2024 "to increase meaningfully year-over-year" due to continued investments and product development efforts.

While revenues for Reality Labs were down, Meta may have help on the way. The tech firm launched its new VR headset, the Meta Quest 3 on October 10, a little over a week into the company's fourth quarter.

During the quarter, Facebook's monthly active users grew by 3% year-on-year to three billion, whereas daily users increased by 5% to two billion.

"We had a good quarter for our community and business. I'm proud of the work our teams have done to advance AI and mixed reality with the launch of Quest 3, Ray-Ban Meta smart glasses, and our AI studio," said Meta CEO Mark Zuckerberg.

The report forecasted that, for Q4 2023, Meta expects revenue to range between $36 billion and $40 billion.