Meta is killing off the metaverse as it pivots to AI
When Mark Zuckerberg renamed Facebook $META to Meta in 2021, he described the metaverse as “the next frontier.” Four and a half years later, the virtual world at the center of this bet is being shut down.
Meta announced this week that Horizon Worlds, its social virtual reality platform, would be removed entirely from Quest headsets by June 15. The app will disappear from the Quest store at the end of March. After that, it only survives as a mobile app, repositioned to compete with platforms like Roblox $RBLX and Fortnite rather than realizing a vision of a virtual future.
The shutdown is the clearest signal yet that the metaverse pivot has been quietly unrolled.
Costs have always been an argument in favor of staying the course. Zuckerberg promised that the metaverse would reach a billion people and generate hundreds of billions of dollars in commerce. Withdrawing meant admitting that these projections were wrong.
What changed calculus was AI. When ChatGPT arrived in late 2022, Meta quickly pivoted its public messaging. Its AI research division, long led by scientist Yann LeCun, has given the company a credible foundation to build on. Advertising revenues have improved. The stock has recovered. By 2024, Meta had almost tripled in value from its 2022 lows.
The Metaverse, meanwhile, continued to bleed.
In January, Meta laid off about 10% of Reality Labs, or about 1,500 people, and closed several VR game studios. A fitness app called Supernatural, which Meta acquired for $400 million in 2021, stopped producing new content and quietly disbanded.
Meta is careful to say that he hasn’t completely abandoned VR. In a blog post published in February, Samantha Ryan, vice president of content at Reality Labs, said the company is “doubling down on the VR developer ecosystem” while moving Horizon Worlds to mobile. New Quest headsets are still planned. Its Ray-Ban smart glasses, which run on AI rather than virtual worlds, have been a rare hardware success, with Zuckerberg recently saying sales had tripled in the past year.
But Horizon Worlds was the flagship product, the product that justified the company’s new name, the place where Zuckerberg’s avatar appeared without legs and became a meme. Its closure marks much more than a decision regarding a product.
