Meta publishes promising Quest revenue for first quarter of 2024

Meta publishes promising Quest revenue for first quarter of 2024
Meta has just published the quarterly earnings report for its Reality Labs division. Reality Labs’ revenue is up by 30% compared to Q1 2023: coming in at $440 million. The division as a whole continues to operate at a loss for now but Meta is confident that it’s a viable long-term investment.

Meta’s CFO Susan Li attributes the increase in revenue to Quest headset sales. Q4 2023 was the highest quarterly revenue Reality Labs had ever seen. Susan had claimed at the time that that was because of Quest 3 sales during the holidays.

Q1 2024’s success is very likely the continuing momentum from the Quest 3’s launch as more and more people hop on the bandwagon. Matthew Ball is the CEO at Epyllion — a holding company — and a popular writer about the future of computing. He visualized Reality Labs’ revenue in a recent tweet.

Reality Labs, formerly known as Oculus VR, continues to operate at a loss of billions of Dollars each year. Mark Zuckerberg, CEO at Meta, has in the past told investors that he doesn’t expect Reality Labs to turn a profit until the 2030’s.

Also worth mentioning is that despite Q1 2024 being better than Q1 2023, it still fails to reach the heights of the first quarters of 2021 and 2022. This was expected, in my opinion, as society returns to the physical office and loses out on leisure time. Also, Virtual Reality still remains a niche hobby most consumers do not participate in.

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The Meta Quest 3's launch sent 2023 off with a bang.

I do think Zuckerberg knows what he’s talking about, however. Meta has, in my opinion, been making all the right moves to not just grow itself but also grow the entire XR industry.

For example, Meta recently rebranded its Quest OS to Horizon OS and made it open-source. This helps the industry grow as more manufacturers try giving VR headsets a shot because they have the software already provided. And it will also net Meta a tidy profit.

If Meta’s plan to become the “Android of XR” pans out they could be looking at billions in revenue each year. Similar to how Google makes over $92 billion a year from Android. Then there’s also talks of a Quest 3 Lite.

These are only rumors for now. But if a Quest 3 Lite does come out it will probably be priced lower than the Quest 3. This will lower the barrier of entry to VR and Meta’s Horizon ecosystem will grow even further.

Reality Labs is also earning from Ray-Ban’s smart glasses, which are now powered by Meta AI. So I honestly do believe Meta is headed in the right direction. It might take a while, perhaps, but we’ll get there one day.
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