Meta's cash drains face a turnaround

Meta CEO Mark Zuckerberg said during the company's third-quarter earnings call on Wednesday that Muse and Reality Labs, two highly unprofitable divisions, could finally start turning profits.

Muse is compute intensive but fixable

Zuckerberg said Muse, the AI assistant Meta launched last month, is unprofitable because it is very compute intensive to run. Meta expects to start turning that around next year by massively improving Muse's efficiency.

“If compute efficiency continues improving quickly for another few years, which we think is highly likely, then Muse will be highly profitable over multiple years.”

Reality Labs losses will narrow sharply

Reality Labs, which makes Meta Ray-Bans and virtual reality glasses, will narrow its losses to about fifteen billion dollars in twenty twenty-seven, down from eighteen to nineteen billion dollars expected this year.

Zuckerberg sees path to profitability

Zuckerberg said Reality Labs should start trending toward profitability next year as Meta's AI systems make its products more useful. He believes the path to holographic experience comes through VR first.

“I continue to believe that the path to delivering holographic experience, of bringing together the physical and digital worlds and everyday glasses, will come through VR first.”