Mark Zuckerberg spent $21 billion on the metaverse
Mark Zuckerberg has just announced more than difficult results for the Meta group. Blame his project on the metaverse.
The numbers are alarming. -52% profit compared to 2021, -4% turnover, no data is in green on the Meta side. The release of the company’s latest data also impacted Meta’s stock market valuation. A few months ago, Mark Zuckerberg, boss of Facebook (and therefore of Meta), proudly announced that he had reached the milestone of 1 trillion evaluations. Today the company is nearly 350 billion.
But how to explain this dizzying fall? The answer lies in one word: the metaverse. The virtual universe project, so dear to Mark Zuckerberg, fails to convince. With its Reality Labs division, responsible for the design of the project, the Meta group loses more than 10 billion dollars a year, almost one a year.
The metaverse weighs on the group’s finances
In a press release to investors, the heads of the Meta group are realistic: We expect Reality Labs’ operating losses to increase significantly year on year in 2023. “ The situation will therefore hardly improve and the group, in difficulty, could see its loyal customers go away one after the other.
At the end of 2021, Meta had a cash flow of $ 12 billion. But in 10 months that money was gone. To make a comparison and better understand the unprecedented importance of this investment, the French state budget for ecology and the development of soft mobility was 21.6 billion euros in 2022. they are metavers.
But all this ruthlessness is far from bearing fruit. When Mark Zuckerberg assured that the world will appreciate his team’s work ten years from now, many pundits are less optimistic. Today, Meta’s “Horizon World” looks more like Creuse than Ile de France. With just 200,000 active people per month, the Facebook boss’s virtual world looks primarily like a great digital desert.
A project that nobody likes
The project is not interesting internally either. A note to employees was recently intercepted by the press. The latter explicitly asked the group’s employees to connect to the virtual world at least once a day, despite bugs and other problems that can complicate the experience.
Ahead of the announcement of Meta’s financial results, Brad Gerstner, a key figure in Facebook history, has called for an immediate cost cut. In particular, he explains that the development of metavers should not exceed $ 5 billion per year. This is half of the budget available today.