Meta burned $19 billion on VR last year, and 2026 won’t be any better

Earlier this month, Meta laid off 10% of the workforce at Reality Labs, its virtual reality division, reportedly laying off as many as 1,000 employees. Now, in a development that appears to be directly related, the company has revealed that the unit lost many billions of dollars last year.

Meta’s is on Wednesday income report showed that the troubled virtual reality company had lost about $19.1 billion in 2025, which is slightly more than in 2024 (that year losses hovered around $17.7 billion). In the fourth quarter, the division posted a loss of $6.2 billion, the report showed.

These losses were in stark contrast to what the unit generated in revenue: $955 million in the fourth quarter and about $2.2 billion through all of 2025.

During the company’s earnings call on Wednesday, Mark Zuckerberg struck an optimistic tone for his company’s VR team, while noting that losses are expected to be much the same in 2026.

“For Reality Labs, we are focusing the majority of our investments going forward on glasses and wearables, as we focus on making Horizon a huge success on mobile and making VR a profitable ecosystem in the coming years,” Zuckerberg said on the call. However, the CEO noted that losses were expected to continue. “I expect Reality Labs’ losses this year to be similar to last year,” Zuckerberg said, noting that this year “would likely be the peak as we begin to gradually reduce our losses going forward.”

When Meta announced a move into the ‘metaverse’ in 2021, the move was viewed with a degree of skepticism and during the first year of VR efforts, the company decided faced harsh criticism – even becomes a “international laughing stock.” Nearly half a decade later, that skepticism has not exactly disappeared. As the VR business continues to lose money and Meta continues to make an aggressive pivot from VR to AI, it’s unclear what exactly will change the ailing company.

Last week, CNBC reported thatIn addition to the layoffs, Meta had plans to close some of its VR studios – another sign that the company’s interest in virtual reality is waning. The company also recently announced this is discontinuing the standalone Workrooms app – that the company had pitched to office workers as a VR room that could be used to hold meetings.