According to CNBC, CEO Mark Zuckerberg of Meta (Facebook) has confirmed that he will pour billions more dollars to develop the digital universe despite the current worries of declining revenue of investors.
The above assertion was made by the Facebook founder in the analysis session after the third quarter financial report, when the company said that expenses increased by 19% year-on-year to $22.1 billion is one of the main reasons for poor business results.
In its latest financial report, Meta’s revenue fell 4% in the third quarter year-over-year to $27.7 billion, while profits also fell 52% to $4.4 billion.
In particular, Meta’s Reality Labs virtual reality headset has recorded a loss of $9.4 billion year-to-date. Total revenue from this segment also recorded a decrease of nearly 50% in the third quarter compared to the same period a year ago to 285 million USD. Meta CFO Dave Wehner says the main reason for this drop is down sales of Quest 2 radiuses.
Immediately, shares of Meta fell 19% as investors worried the social network continued to lose money because it burned money on Mark Zuckerberg’s virtual universe gamble.
In its statement, Meta said that it recognized the loss of the virtual universe segment and predicted that this number of losses would increase in the near future, but the group will still invest money in the technology to aim achieve long-term goals.
Jefferies expert Brent Thrill said that Meta seems to be pouring money into a gamble when they neglect the main profit-making business for the business, while the main investment channel is losing money.
“I think there should be a distinction between something that is being tested and a new technology that will be really successful in the future. However, in general, we are still working on many areas and are quite confident that we are doing well,” countered CEO mark Zuckerberg, citing that they are still doing well through improving the short video service Reel, content algorithms, business messaging and online advertising technology.
CNBC reported that the Facebook founder could not confirm how much money he would spend or how large this “bet” would be, but the new technology is being upgraded gradually in the right direction.
“Clearly, the virtual universe will be the long-term plan that we aim to … This technology will eventually succeed” said CEO Mark Zuckerberg.
Sweet fruit?
Confident, but the founder of Facebook also said that he is facing many difficulties today.
“There are so many challenges in doing business today. It’s hard to tell the world that ‘we’re doing this new technology and it’s going to solve all the problems” CEO Mark lamented.
CNBC reports that Meta is facing numerous challenges such as the economy at risk of recession, Apple’s upgrade of consumer information privacy provisions, making it difficult for Facebook to sell ads or compete from rival Tiktok.
Therefore, CEO Mark Zuckerberg believes that investing in the virtual universe in the long term will help Meta earn new sources of income in the future.
“I think we’ve finally solved each of these difficult problems. I appreciate everyone’s patience and believe that those who accept to invest with us in the end will receive a worthy reward,” said CEO Mark.
In addition, CEO Mark also said that another reason why the company is developing a virtual universe today is to ensure that their social networking platform will not be affected by advertising revenue due to the decision of another party such as: Apple did before.
In addition, Facebook will have a lot of advantages when developing both hardware and software for the new platform, while maintaining its independence, having more revenue streams, and promoting many technological innovations.
“You will build more new things and improve technology if you have control over your product platform,” said CEO Mark.
Source: CNBC
Source: Vietnam Insider