Meta’s Reality Labs Reports $4.4 Billion Loss : Meta has released its earnings report for the third quarter of 2025, revealing a mixed performance across its divisions. While the company recorded an impressive $56 billion (approximately Rs. 4.9 lakh crore) in total revenue, marking a 26% year-over-year (YoY) growth, its Reality Labs division — which focuses on augmented and virtual reality products — reported another significant loss of $4.4 billion (roughly Rs. 39,000 crore).
Reality Labs: Rising Revenue, Mounting Losses
According to Meta’s report, Reality Labs generated $470 million (around Rs. 4,170 crore) in revenue for Q3 2025, up 74% from $270 million during the same period last year. Despite this substantial increase in sales, the division’s expenses outweighed its revenue, leading to a $4.4 billion loss for the quarter.
As per a CNBC report, Reality Labs has now accumulated a total loss of $70 billion (approximately Rs. 6.2 lakh crore) since late 2020. These consistent losses highlight the steep investment costs associated with augmented reality (AR) and virtual reality (VR) technologies — areas Meta continues to push aggressively despite slow returns.
Zuckerberg’s Remarks on Performance
During the earnings call, Meta CEO Mark Zuckerberg acknowledged that while AI glasses performed strongly in Q3, much of the division’s losses were tied to Quest-branded headsets. Interestingly, the headsets also saw better-than-expected performance due to increased demand from retailers ahead of the holiday season.
“The significant year-over-year growth in Q3 was partly due to retail partners stocking up on Quest headsets ahead of the holiday season. We did not have a similar benefit last year since our Quest 3S headset launched in Q4 2024,” Zuckerberg said.
Outlook for Reality Labs
Looking ahead, Meta remains cautious about the division’s future performance. Chief Financial Officer Susan Li stated that Q4 Reality Labs revenue will likely decline compared to last year, primarily because there is no new headset launch planned for 2025, unlike the previous year’s Quest 3S release.
“We expect Q4 Reality Labs revenue to be lower than last year… The biggest factor is we’re lapping the introduction of Quest 3S in Q4 of last year, and we don’t have a new headset in the market this year,” Li said.
The Bigger Picture
Reality Labs’ persistent losses underscore Meta’s long-term gamble on immersive technologies and the metaverse vision. While AR and VR innovations like Quest headsets and AI-powered Ray-Ban glasses are gradually gaining traction, they have yet to reach mass-market profitability.
Still, Meta continues to double down on Reality Labs, viewing it as a strategic investment in the future of social interaction, productivity, and digital environments — even if the present numbers paint a challenging picture.
