Earlier this month, Meta laid off 10% of the staff at Reality Labs, its virtual reality unit, would have cut up to 1,000 employees. Now, in a development that appears directly related, the company revealed that the unit lost several billion dollars last year.
Wednesday, Meta’s income report showed that its struggling virtual reality business lost some $19.1 billion in 2025, slightly more than in 2024 (that year, losses hovered around $17.7 billion). In the fourth quarter, the unit posted a loss of $6.2 billion, according to the report.
These losses contrast with what the unit generated in terms of sales: $955 million in the fourth quarter and some $2.2 billion throughout 2025.
During the company’s earnings conference call on Wednesday, Mark Zuckerberg struck an optimistic tone toward his company’s VR team, while noting that losses in 2026 are expected to be about the same.
“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 a profitable ecosystem in the years to come,” Zuckerberg said on the call. However, the CEO noted that losses are expected to continue. “I expect Reality Labs’ losses this year to be similar to last year,” Zuckerberg said, while noting that this year would “probably be the peak, as we begin to gradually reduce our losses going forward.”
When Meta announced a pivot to the “metaverse” in 2021, the move was viewed with some skepticism, and in its first year of VR efforts, the company faces harsh criticism – even being described as “international laughing stock.” Nearly half a decade later, this skepticism didn’t really calm down. As the VR industry continues to lose money and Meta continues to move away from VR and toward AI, it’s unclear what will turn around the struggling company.
Last week, CNBC reported thatin addition to the layoffs, Meta was considering closing a number of its virtual reality studios – another sign that the company’s interest in virtual reality is waning. The company also recently announced that it would removal of its standalone Workrooms app – which the company had pitched to office workers as a VR space that could be used to hold meetings.
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Lucas is a senior writer at TechCrunch, where he covers artificial intelligence, consumer technology and startups. He previously covered AI and cybersecurity at Gizmodo. You can contact Lucas by email at lucas.ropek@techcrunch.com.