Meta has burned more than $15 billion into the metaverse project since the beginning of last year, and the exact details of where that money went remain unclear.
Some experts expressed disappointment with the updates Meta provided earlier this week as they thought the new technology would have gone further.
Meta has spent more than $15 billion on its venture since the beginning of last year, but so far, the company has not shared where exactly it has spent the money.
"The problem is they're spending money, but the transparency with investors is a disaster," said Dan Ives, technology analyst at Wedbush Securities.
"This continues to be a risky bet for Zuckerberg and his team because for now, they're betting money on the future while continuing to have huge problems in their core business," he added.
When Meta began disclosing Reality Labs' financial information last year, the company said it had put more than $10 billion into the venture. So far, the company has reported losses of more than $5 billion for the first six months of 2022, with some analysts predicting total losses for this year to grow.
Meta declined to comment for this story, but a company spokesperson said Meta does not release financial details for its Reality Labs division.
Ives mentioned that the amount Meta has spent on the metaverse so far is concerning, given the updates it provided this week, namely a new $1.500 device and a full-body avatar.
Mark Zgutowicz, an analyst at Benchmark, said that while he doesn't know for sure, he estimates that at least 60% of Reality Labs' losses are due to the massive research and development costs involved in building an entirely new world.
"There is no real metaverse, at least until we can all wear glasses that don't make us look like aliens or something," he said.
Zgutowicz pointed out that Meta has many reasons for trying to build everything on its own.
But Ivan Feinseth, technology analyst at Tigress Financial Partners, said he believes in Mark Zuckerberg's long-term vision and his promise for the metaverse.
“When Facebook first bought Instagram, a lot of people laughed at them and said they were crazy. They said, “this guy is going to throw away all this money” but Instagram turned out to be one of the best buys of all time.
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George is still wondering what he is doing here….
