{"id":9522,"date":"2022-02-03T21:13:08","date_gmt":"2022-02-03T21:13:08","guid":{"rendered":"https:\/\/mailinvest.blog\/index.php\/2022\/02\/03\/facebook-announces-metaverse-losses-complains-about-apples-privacy-changes\/"},"modified":"2022-02-03T21:13:08","modified_gmt":"2022-02-03T21:13:08","slug":"facebook-announces-metaverse-losses-complains-about-apples-privacy-changes","status":"publish","type":"post","link":"https:\/\/mailinvest.blog\/index.php\/2022\/02\/03\/facebook-announces-metaverse-losses-complains-about-apples-privacy-changes\/","title":{"rendered":"Facebook Announces Metaverse Losses, Complains About Apple’s Privacy Changes"},"content":{"rendered":"

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(Photo: Greg Bulla\/Unsplash)<\/small><\/center>Now that Facebook is officially called Meta, the company has officially split into two factions: the Virtual Reality (VR) side of the operation, and the \u201capps\u201d side. The VR side is the Meta part of the company (formerly Oculus), and includes its Reality Labs business, and the other half is called Family of Apps (FoA), which includes WhatsApp, Instagram, Facebook, and Messenger. Since they\u2019re separate now, the company has begun reporting revenue for each side of the business. In this week\u2019s quarterly (with an annual summary) earnings call from the company we got our first look into how its Metaverse operation is going. As you might expect at this early stage, it\u2019s not pretty. Meta also predicted that Apple\u2019s recent changes to its iOS privacy policy that lets iPhone users opt-out of tracking will continue to affect its bottom line in a huge way for the foreseeable future.<\/p>\n

The big picture from the earnings call<\/a> is that the company\u2019s Family of Apps is doing gangbusters business, while Reality Labs is a gigantic pit into which the company tosses billions of dollars. Overall the company pulled in $40 billion in net income in 2021, a 35 percent increase year-over-year, according to a summary posted by Slashgear<\/a>. All the income is on the apps side of the equation, however.<\/p>\n

In Q4 2021 Meta\u2019s Family of Apps earned an impressive $15.9 billion dollars, while its Reality Labs segment burned through an astonishing $3.3 billion in the 4th quarter alone. Reality Labs lost around $10 billion total in 2021. Of course, the Metaverse isn\u2019t just going to spring up overnight, so the company obviously needs to invest heavily in that side of its business, but it\u2019s interesting to see the actual cost involved thus far.<\/p>\n

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The company is pouring a ton of money ints VR hardware, such as this prototype haptic glove design. (Image: Meta)<\/p>\n<\/div>\n

Despite increases in revenue for the company, its 4th quarter earnings weren\u2019t up to expectations. This caused Meta\u2019s stock to fall precipitously. The Company Formerly Known as Facebook also reported the first ever decline in daily users, according to CNBC\u2019s summary<\/a>. Despite the drop, it still reported it has 2.82 billion Daily Active People (DAP), and 3.59 billion Monthly Active People. Most of the adult world is still using Facebook, or one of its associated apps. Former company insider Frances Haugen filed an SEC complaint<\/a> last year alleging the company had been manipulating its reporting on the size of its customer base but there\u2019s no evidence it is still doing so.<\/p>\n

In its earnings call the company also pointed out several \u201cheadwinds\u201d it is currently dealing with, and which will likely inhibit its growth in 2022. The most interesting, to us at least, is that Meta has finally put a price tag on Apple\u2019s decision to allow iOS users to opt-out of allowing apps to track them, and it\u2019s a a big number. \u201cWe believe the impact of iOS overall is a headwind on our business in 2022,\u201d said Meta CFO Dave Wehner in a transcript by CNBC<\/a>. \u201cIt\u2019s on the order of $10 billion, so it\u2019s a pretty significant headwind for our business.\u201d To be fair to Dave, he admitted $10 billion is just a guess, as it\u2019s a difficult metric to quantify accurately.<\/p>\n

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Meta also pointed to several other problematic situations, including \u201ccontinued headwinds from both increased competition for people\u2019s time and a shift of engagement within our apps towards video surfaces like Reels, which monetize at lower rates than Feed and Stories.\u201d It sounds as though people are using Tik Tok a lot (competition for people\u2019s time). Additionally, users on Meta\u2019s own apps are watching more Reels instead of scrolling through their feed or watching stories. Meta also said supply chain disruptions combined with inflation have caused companies to lower their ad budgets, which has affected its ad sales.<\/p>\n

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