With the hype surrounding the metaverse having largely died down since 2021, Meta is reportedly preparing to reduce its investment in the sector by 30%. However, the news seems to have been well received by investors.
Meta is reportedly preparing to slow down investment in the metaverse
Four years ago, the Facebook group announced with great fanfare that it was renaming itself Meta, triggering a speculative bubble on all metaverse-related stocks. The promises were grand, with the idea of a digital world powered by virtual reality glasses. Since then, the hype has died down, technical realities have caught up with expectations, and many of the players who had jumped on the bandwagon have either scaled back their ambitions or disappeared from the scene.
According to Bloomberg, Meta’s Reality Labs division’s Metaverse group has suffered more than $70 billion in losses since 2021. Meta’s management is now considering reducing the budget allocated to the metaverse by 30% for 2026, which could logically lead to layoffs as early as January.
On the stock market, investors seem to have welcomed the news, with META shares closing up 3.43% on Thursday, despite a 2.14% decline during the trading session. At the time of writing, META shares are trading at $661.53, down nearly 17% from their all-time high of $796.25 on August 15:
More broadly, Mark Zuckerberg has also reportedly asked the group’s executives to seek “10% reductions across all projects.”
