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Meta’s Reality Labs posts $4.4 billion loss in third quarter
Mark Zuckerberg, chief executive officer of Meta Platforms Inc., wears a pair of Meta Ray-Ban Display AI glasses during the Meta Connect event in Menlo Park, California, US, on Wednesday, Sept. 17, 2025.
David Paul Morris | Bloomberg | Getty Images
Meta continues to sink money into the metaverse, anchored by virtual reality and augmented reality technologies.
The company reported third-quarter earnings on Wednesday and said that the Reality Labs division recorded an operating loss of $4.4 billion while generating $470 million in sales during the period.
Wall Street was expecting Reality Labs to post an operating loss of $5.1 billion on $316 million in revenue.
The Reality Labs unit is responsible for developing the company’s Quest-branded family of VR headsets and Ray-Ban and Oakley AI smart glasses that Meta develops in partnership with eyewear giant EssilorLuxottica.
The company’s Reality Labs division has now recorded over $70 billion in cumulative losses since late 2020, underscoring the high costs of building VR, AR and other consumer hardware.
Finance chief Susan Li told analysts on Wednesday that Meta expects Reality Labs’ revenue for the fourth quarter to come in below what the company reported for the same period last year. Li said this is in part because the company did not introduce a new VR headset in 2025.
“We’re still expecting significant year-over-year growth in AI glasses revenue in Q4 as we benefit from strong demand for the recent products that we’ve introduced, but that is more than offset by the headwinds to the Quest headsets,” Li said.
Meta CEO Mark Zuckerberg in September revealed the $799 Meta Ray-Ban Display glasses, which are the company’s first consumer-ready AI glasses that include a built-in display and an accompanying wristband with neural technology.
EssilorLuxottica said in its most recent earnings report earlier this month that those AI glasses helped lift its sales in the third quarter.
“Clearly there is a lift coming from Ray-Ban Meta wearables as a product category,” EssilorLuxottica CFO Stefano Grassi said during a third-quarter earnings call.
With Meta’s AI glasses becoming a surprise hit, investors have been monitoring for any signs that the company may be shifting its metaverse strategy.
Meta on Monday said that Vishal Shah, who was leading its metaverse initiatives, is now a vice president of AI products in the company’s Superintelligence Labs division that works on AI.
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