Facebook has reported that it is losing daily users for the first time, while its new focus on the metaverse is costing it an awful lot of money.
The social network’s parent company, Meta, issued its quarterly earnings report on Wednesday, and one particular figure stood out. While the social network still had 1.929 billion users logging in each day from October to December, this represented a drop of around half a million users from 1.93 billion during the previous quarter.
It’s a small fraction, but a worrying one for the company. This is the first time the company has lost users in its 18 year history.
Not only does this loss relate to the surge in TikTok use among young users, as CEO Mark Zuckerberg himself alluded to, but it also suggests that Facebook’s global reach might have just peaked.
Together with lower-than-expected ad growth, which will only get worse with Apple’s punitive privacy changes, the news was sufficient to drop $200 billion from the company’s market value.
The company formerly known as Meta is in a tricky period, with its recent rebranding reflecting a shift in strategy towards the creation of the metaverse – or the virtual environment in which tomorrow’s AR and VR experiences are expected to co-exist.
This is proving to be a hugely expensive bet for company CEO Mark Zuckerberg. According to this latest quarterly report, Meta’s Reality Labs division lost $10 billion in 2021.
Zuckerberg explained that his fully realised metaverse vision was “still a ways off,” and that the company’s path was “not yet perfectly defined”.
With a new high-end VR headset in the works, the company will be hoping its mixed reality bet will start paying off soon.