MENLO PARK, California, February 1, 2026, 04:29 (PST)
- Meta Platforms’ Reality Labs posted an operating loss of about $19.2 billion in 2025.
- The unit’s fourth-quarter operating loss was about $6.0 billion, even as it generated roughly $1.0 billion in revenue.
- Meta has indicated Reality Labs losses in 2026 should track roughly in line with 2025.
Reality Labs, Meta’s virtual and augmented reality unit, posted an operating loss of $19.193 billion in 2025 — meaning costs outweighed revenue before interest and taxes — up from $17.729 billion a year earlier, the company said. The division recorded a $6.021 billion operating loss in the fourth quarter, on revenue of $955 million. (Atmeta)
The scale matters now because Meta is trying to sell investors on two expensive tracks at once: artificial intelligence infrastructure on one side, and a long bet on headsets and smart glasses on the other. Reality Labs remains the clearest line item for that second bet.
The division sits at the center of Meta’s drive toward a “metaverse” — a loose idea of shared digital spaces people enter through headsets or glasses — even as the company’s language around it has shifted. It is also a test of how long the company can carry big losses outside its core ad business without a clear payoff.
Zuckerberg has pushed the effort toward devices that look less like a helmet and more like something people might wear outside. “We are directing most of our investment towards glasses and wearables,” he said on the earnings call, adding that 2026 would “likely be the peak” for the unit’s losses as Meta tries to “gradually reduce” them over time. (80 Level)
Meta has also trimmed the unit. Media reports put recent Reality Labs layoffs at about 10% of staff, with cuts that could reach as many as 1,000 jobs. (TechCrunch)
Analyst George Jijiashvili at Omdia said the company was tired of being “entirely dependent on iOS held by Apple,” and on Android and the Play Store controlled by Google. Per Ola Kristensson at the University of Cambridge pointed to a simpler drag: in tests of office work in VR, “you can, but you will hate it.” He also said Meta’s move to push Horizon onto mobile looks like a response to large virtual platforms such as Roblox that do not require headsets. (euronews)
But Meta’s own filings underline the uncertainty. The company warned that the metaverse “may not develop” as it expects and that market acceptance of new products is uncertain, even as it signaled Reality Labs operating losses in 2026 should remain similar to 2025. (SEC)
Reality Labs still brings in revenue, but it has not come close to covering the investment pace. For Meta, the math only works if the devices become a platform — not a niche gadget — and if developers and users show up in big numbers.
For now, Zuckerberg is trying to keep the spending story from becoming a single word: “metaverse.” He is pitching the same lab as a path to AI-first wearables and a broader “extended reality” stack, with virtual reality as part of the mix, not the headline.
Whether that shift produces a profitable business — or simply a smaller annual loss — is what investors will be watching through 2026.
