Meta burns $4B quarterly on AR/VR, plans $125-145B AI spend
Original: Meta is still burning money on AR/VR
Why This Matters
Shows tech giant's massive pivot from failed metaverse bet to AI race
Meta's Reality Labs division lost $4 billion in Q1 2026, maintaining its average quarterly loss rate. The company has lost $83.5 billion on AR/VR over 21 quarters since 2021, while projecting $125-145 billion in AI spending for 2026.
Meta reported $4 billion losses from Reality Labs in Q1 2026, continuing a pattern of consistent quarterly losses averaging $4 billion since 2021. Over 21 quarters, the AR/VR division has accumulated $83.5 billion in total losses. Despite strong financial performance with $26.8 billion net income (up 61% year-over-year) and $56.3 billion revenue (up 33%), Meta is shifting focus from metaverse to AI competition. CEO Mark Zuckerberg announced projected spending of $125-145 billion for 2026, exceeding analyst expectations, primarily for AI infrastructure and higher memory component costs. The company hired over 50 AI researchers from competitors and launched its Muse Spark AI model.