Mark Zuckerberg says Reality Labs will (eventually) stop losing so much money

Mark Zuckerberg says an end to Reality Labs’ years of multibillion-dollar losses is in sight following the company’s layoffs at the Metaverse division earlier this year. The CEO said he expects to “gradually reduce” the company’s money losses as it doubles down on purchases of AI glasses and moves away from virtual reality.

Speaking during Meta’s fourth-quarter earnings call, Zuckerberg made it clear the changes wouldn’t happen anytime soon, but was optimistic about the division losing more than $19 billion in 2025 alone. “For Reality Labs, we are directing most of our investments toward glasses and wearables, while working to make Horizon a massive success on mobile and make VR an ecosystem profitable in the years to come,” he said. “I expect Reality Labs’ losses this year to be similar to last year, and this will likely be the peak, as we begin to gradually reduce our losses going forward.”

The company cut more than 1,000 Reality Labs employees earlier this month, closed three virtual reality studios and announced plans to retire its app for virtual reality meetings. Meta has also suspended plans for third-party Horizon OS headsets. Instead, Meta is doubling down on its business into smart glasses and wearables, which better fit with Zuckerberg’s vision of creating AI “superintelligence.”

During the call, Zuckerberg noted that sales of Meta’s smart glasses “more than tripled” in 2025, and hinted at more ambitious plans for AR glasses. “They [AI glasses] will be able to see what you see, hear what you hear, talk to you and help you throughout your day and even show you information or generate a personalized user interface right in your vision,” he said.

Zuckerberg has spent the last few years laying the groundwork for pivoting Metaverse work from Meta to AI. He gave an example of what Meta’s Horizon app means.

“You can imagine… people being able to easily, through a prompt, create a world or create a game, and be able to share it with the people they care about. And you see it in your feed, and you can go directly to it, and you can participate in it. And there are 3D versions of that, and there are 2D versions of that. And Horizon, I think, fits the kind of immersive 3D version of that very well.

“But there’s definitely a version of the future where, you know, any video that you see, you can, like, tap on it and go to it and, like, engage and kind of experience it in a more meaningful way. And I think the investments that we’ve made both in a lot of virtual reality software and in Horizon… are actually going to combine well with these advances in AI to be able to bring some of these experiences to hundreds of millions and billions of people through mobile.”

However, one thing Zuckerberg didn’t mention: the word “metaverse.”