Meta spent $19 billion on VR last year, and 2026 won’t be any better

Earlier this month, Meta laid off 10% of the staff at Reality Labs, its virtual reality unit, laying off up to 1,000 employees. Now, in a development that appears directly related, the company has revealed that the unit lost several billion dollars last year.

On Wednesday, Meta’s earnings report showed that its beleaguered VR business lost about $19.1 billion in 2025, slightly more than it lost in 2024 (that year, losses hovered around $17.7 billion). The report showed that the unit recorded a loss of $6.2 billion in the fourth quarter.

These losses were compared to the unit’s sales: $955 million in the fourth quarter and about $2.2 billion throughout 2025.

During the company’s earnings call on Wednesday, Mark Zuckerberg struck a tone of optimism for his company’s virtual reality team while noting that losses in 2026 are expected to be largely the same.

“For Reality Labs, we are directing most of our investments toward future glasses and wearables, with a focus on making Horizon a massive success on mobile and making VR a profitable ecosystem over the coming years,” Zuckerberg said during the call. However, the CEO noted that losses are expected to continue. “I expect Reality Labs’ losses this year to be similar to last year,” Zuckerberg said, noting that this year “is likely to be the peak, as we begin to gradually reduce our losses going forward.”

When Meta announced its pivot to “transformation” in 2021, the move was viewed with a certain amount of skepticism, and during its first year of VR efforts, the company faced harsh criticism — it was even referred to as an “international laughing stock.” Nearly half a decade later, these doubts have not completely subsided. As the VR sector continues to lose money and Meta continues to shift aggressively away from VR and toward AI, it’s unclear what exactly will turn around the struggling business.

Last week, CNBC reported that in addition to the layoffs, Meta had plans to shutter a number of its VR studios — another sign that the company’s interest in VR is waning. The company also recently announced that it would stop using the standalone Workrooms app, which the company offered to office workers as a virtual reality space that could be used for meetings.