Mark Zuckerberg says there's an end in sight to Reality Labs' years of multibillion-dollar losses following the company's layoffs to the metaverse division earlier this year. The CEO said he expects to "gradually reduce" how much money the company is losing as it doubles down on AI glasses and shifts away from virtual reality.
Speaking during Meta's fourth-quarter earnings call, Zuckerberg was clear that the changes won't happen soon, but sounded optimistic about the division that lost more than $19 billion in 2025 alone. "For Reality Labs, we are directing most of our investment towards glasses and wearables going forward, while focusing on making Horizon a massive success on mobile and making VR a profitable ecosystem over the coming years," he said. "I expect Reality Labs losses this year to be similar to last year, and this will likely be the peak, as we start to gradually reduce our losses going forward."
The company cut more than 1,000 employees from Reality Labs earlier this month, shut down three VR studios and announced plans to retire its app for VR meetings. Meta has also paused plans for third-party Horizon OS headsets. Instead, Meta is doubling down on its smart glasses and and wearables business, which tie in more neatly to Zuckerberg's vision for creating AI "superintelligence."
During the call, Zuckerberg noted that sales of Meta's smart glasses "more than tripled" in 2025, and hinted at bigger plans for AR glasses. "They [AI glasses] are going to be able to see what you see, hear what you hear, talk to you and help you as you go about your day and even show you information or generate custom UI right there in your vision," he said.
Zuckerberg has spent the last few years laying the groundwork for pivoting Meta's metaverse work into AI. He offered one example if what the means for Meta’s Horizon app.
"You can imagine … people being able to easily, through a prompt, create a world or create a game, and be able to share that with people who they care about. And you see it in your feed, and you can jump right into it, and you can engage in it. And there are 3D versions of that, and there are 2D versions of that. And Horizon, I think fits very well with the kind of immersive 3D version of that.
“But there's definitely a version of the future where, you know, any video that you see, you can, like, tap on and jump into it and, like, engage and kind of like, experience it in a more meaningful way. And I think that the investments that we've done in both a lot of the virtual reality software and Horizon … are actually going to pair well with these AI advances to be able to bring some of those experiences to hundreds of millions and billions of people through mobile."
One thing Zuckerberg didn’t mention, though: the word “metaverse.”
