Quick take:
- Mark Zuckerberg says he expects more losses due to metaverse investments in the coming years.
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- The company spent $10 billion in 2021 alone, but Zuckerberg expects it to bleed money for another 3-5 years.
- The Meta CEO told investors some products could take as long as 15 years before they are ready for the market.
Meta Platforms, formerly Facebook, brought the name metaverse to the mainstream when it changed its corporate name to signal its change in strategy. When announcing the change in October 2021, Meta CEO Mark Zuckerberg said the company was going to build its business around the metaverse.
Since then, Meta has rolled out several Web3 products and features across its platforms, including the launch of its own metaverse platform, Horizon Worlds. After spending $10 billion in 2021 towards building the metaverse, Meta shares tanked amid the impact the capital expenditure had on the bottom line.
And now, it seems that investors may have to endue more cash burning activity after Zuckerberg said the company will continue to bleed money for the next 3-5 years.
Speaking via a virtual conference on Wednesday, the Meta CEO said the metaverse project will lose a significant amount of money over the next few years.
Earlier this year, Meta unveiled its massive AI supercomputer, which it said will power communications in the metaverse. The big machine was scheduled to be fully operational this summer, but no update has been made since.
Zuckerberg said that some of the products under development may not be ready for the market for at least another 10-15 years, again illustrating the uncertain future surrounding some of the products the company has already invested in.
“We want to get the hardware to be as affordable as possible for everyone, and make sure the digital economy grows,” Zuckerberg told shareholders, as per Bloomberg.
Meta has already hired 10,000 employees to work on Zuckerberg’s vision and plans to hire an additional 10,000 to work on the project.
Analysts believe that those plans could be halted after the social media conglomerate imposed a hiring freeze due to the unpredictable economic situation.
The metaverse is an immersive space where creators and businesses will be able to create an economic system selling virtual products and services. In Wednesday’s meeting, Zuckerberg shot down a proposed vote from shareholders on whether the company should continue with the metaverse project amid doubts that it may not be “prudent and appropriate”.
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