Meta lost $2.8 billion trying to build the metaverse last quarter
Facebook’s decade-long streak of nonstop revenue growth has come to end.its first-ever yearly decline in revenue for the second quarter, announcing a 1 percent drop to $28.8 billion, and predicted that growth in the third quarter could fall even more. The overall profit for its parent company, Meta, fell 36 percent to $6.6 billion. The Reality Labs division responsible for building Mark Zuckerberg’s metaverse dreams lost $2.8 billion in the quarter.
While the first-ever drop in revenue growth was expected on Wall Street going into Wednesday’s earnings report, it solidifies how challenged Meta’s business has quickly become on all fronts. Apple’s “ask app not to track” prompt on iPhones has made its ads much less effective, costing Meta $10 billion in ad revenue last year alone. And now a rapidly slowing economy has caused advertisers to pull back on their spending.
There is a silver lining for Meta in its most recent earnings: It managed to grow Facebook’s daily users by 3 percent to 1.97 billion, in users it observed a couple of quarters ago. Meta reported that 2.88 billion now use its suite of social apps — Facebook, Messenger, Instagram, and WhatsApp — every day, an increase of 4 percent from a year ago.
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