Call him tech’s Captain Ahab, but Meta’s Mark Zuckerberg is still doggedly in pursuit of making the Metaverse happen, even if it’s costing his company billions and generative AI has taken over the hype cycle.
There was some better Q2 earnings news for Meta overall yesterday, with revenue of $32 billion up 11% year-on-year, and net income of $7.79 billion, up from $6.7 billion for the comparable quarter. But Reality Labs, the division responsible for Metaverse, turned in a loss of $3.73 billion, worse than the $2.8 billion it was shedding this time last year.
There will be no turning back though, vows Zuckerberg:
This is an ambitious long-term horizon, multi-faceted roadmap. There are lots of components to the Reality Labs portfolio across VR, AR, Metaverse, social platforms, neural interfaces, and we really have a long-term time horizon for evaluating the return on our investments here. I can't guarantee you that I'm going to be right about this bet. I do think that this is the direction that the world is going in.
And even with massive losses, it is delivering results, he insists:
The Metaverse content and software vision continues coming together as well. We recently announced that Roblox is coming to Quest with an open beta on App Lab. For Horizon, the team is focused on retention right now and we're making good progress on that. We made big improvements on avatars as well and that's going to be a bridge between our mobile apps and our VR and mixed reality experiences.
The Metaverse focus can co-exist with a pivot to AI, he added:
Our investments in AI continue. We remain fully committed to the Metaverse vision as well. We've been working on both of these two major priorities for many years in parallel now, and in many ways the two areas are overlapping and complementary.
The two technological waves that we're riding are AI in the near-term and the Metaverse over the longer-term. Investments that we've made over the years in AI, including the billions of dollars we've spent on AI infrastructure are clearly paying-off across our ranking and recommendation systems and improving engagement and monetization. AI recommended content from accounts you don't follow is now the fastest-growing category of content on Facebook's feed. Now, since introducing these recommendations, they've driven a 7% increase in overall time spent on the platform.
The other big deal in the latest quarter was, of course, the launch of supposed Twitter/X/‘whatever’s in Musk’s head today’ killer, Threads. Zuckerberg said:
I'm quite optimistic about our trajectory here. We saw unprecedented growth out-of-the-gate. And more importantly, we're seeing more people coming back daily than I'd expected. And now we're focused on retention and improving the basics. And then after that, we'll focus on growing the community to the scale that we think is going to be possible. Only after that we are going to focus on monetization. We've run this playbook many times before with Facebook, Instagram, WhatsApp, Stories, Reels and more. And this is as good of a start as we could have hoped for. So I'm really happy with the path that we're on here.
I know from an investor standpoint, most people aren't investing on quite as long of a time horizon as we are here, so I kind of get that. A lot of investors might want to see us spending less here in the near term. My view is that, we are leading in these areas. I believe that they're going to be big over time.
Mark Zuckerberg, CEO, Meta Platforms
There's no way to stop my singing in this world but to cut my throat. And when that's done, ten to one I sing ye the doxology for a wind-up.
Herman Melville, Moby Dick.