Earlier this month, Meta laid off 10% of the staff for Reality Labs, its virtual reality unit, reportedly cutting as many as 1,000 employees. Now, in a development that seems directly related, the company has revealed that the unit lost many billions of dollars last year.
On Wednesday, Meta’s earnings report showed that its embattled virtual reality business had lost some $19.1 billion in 2025, which is slightly more than it lost in 2024 (that year, the losses hovered around $17.7 billion). In its fourth quarter, the unit posted a loss of $6.2 billion, the report shows.
Those losses stood against what the unit generated in sales: $955 million in Q4 and some $2.2 billion throughout 2025.
During the company’s earnings call on Wednesday, Mark Zuckerberg struck a tone of optimism for his company’s VR team while noting that losses in 2026 are expected to be very much the same.
“For Reality Labs, we are directing most of our investment towards glasses and wearables going forward, while focusing on making Horizon a massive success on Mobile and making VR a profitable ecosystem over the coming years,” Zuckerberg said, during the call. However, the CEO noted that losses were expected to continue. “I expect Reality Labs losses this year to be similar to last year,” Zuckerberg said, while noting that this year would “likely be the peak, as we start to gradually reduce our losses going forward.”
When Meta announced a pivot toward the “metaverse” in 2021, the move was regarded with a certain amount of skepticism and, during its first year of VR efforts, the company faced harsh criticism — even being referred to as an “international laughingstock.” Nearly half a decade later, that skepticism hasn’t exactly subsided. As the VR business continues to lose money and Meta continues an aggressive pivot away from VR and toward AI, it’s unclear what exactly will turn the ailing business around.
Last week, CNBC reported that, in addition to the layoffs, Meta had plans to shutter a number of its VR studios — another sign that the company’s interest in virtual reality is waning. The company also recently announced that it would be retiring its standalone Workrooms app — which the company had pitched to office workers as a VR space that could be used to hold meetings.
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