In its Q1 2019 earnings call, Meta announced $440 million in quarterly Reality Labs revenue. This is 30% more than the Q1 2020. Meta’s CFO Susan Li said that this record revenue is “driven by Quest headphone sales”. However, it’s also 36% lower than Q1 2022 and 18% lower than Q1 2021.
This suggests Quest 3 is continuing to sell after its launch quarter, which saw Reality Labs’
, though isn’t maintaining post-launch sales momentum as well as Quest 2 did (though it does have AR glasses).neural wristbandThat’s almost certainly because Quest 3 launched with a $200 higher entry price. It’s $150 more expensive, even after inflation, putting Quest 3 in a higher price range than Quest 2.1001010An old Meta hardware roadmap, reports by The Wall Street Journal and Bloomberg and a Chinese expert who is reliable have all suggested that Meta will soon release a lower-cost version of Quest 3 which would replace Quest 2 and be rumored as “Quest 3S”, or “Quest 3 Lite”.
suggests it is trying to get rid of Quest 2 headsets and accessories in order to move on to this cheaper model. While technically correct, it would be more accurate to call this a quarterly “loss” in Q1 2024.
of Reality Labs’ spending is on research and development for AR glasses. highest quarterly revenue ever of Reality Labs spending is on the research and development of AR glasses.higher retentionAlso, Meta managing to decrease quarterly costs by 1% while increasing revenue by 30% suggests Reality Labs is slowly progressing on the path to profitability. It might also suggest Quest 3 is less subsidised than Quest 2 was.
As in previous quarters, Susan Li told investors she expects these losses to continue to increase meaningfully over the next year due to “ongoing product development efforts and our investments to further scale our ecosystem”.
Mark Zuckerberg has in the past told investors that he doesn’t expect Reality Labs to be profitable until the 2030s, seeing it as a long-term investment in the future of computing.Meta’s recent actions