"Mark Zuckerberg should probably be shaking in his designer sneakers. Although his company Meta Platforms has a trillion-dollar valuation, and its social media platforms are essentially a money-printing machine, he sees virtual reality (VR) and augmented reality (AR) as the future, and VR/AR wearables as key to dominating the future's metaverse. But a powerful new competitor is entering the AR wearables arena, and it's probably the one company Zuckerberg was hoping not to face. Here's why Apple might just eat his VR lunch."
"Despite his big investments, though, Reality Labs' VR headsets like the Quest 3 are still niche products, primarily used for gaming. Even there, they haven't gained much traction. Meta's release of the $300 Quest 3S boosted headset holiday sales in 2024, but overall VR headset purchases declined again in 2024. This stagnation in the headset market may be why Meta has introduced a new wearable product: AI-enhanced glasses in partnership with Ray-Ban."
Meta earns the bulk of revenue from Facebook, Instagram, and WhatsApp, generating $88 billion in ad revenue in the first half of the year. Reality Labs, the wearable division, posted a $4.5 billion loss most recently as VR headsets remain niche and largely gaming-focused. Quest 3S temporarily boosted holiday sales, but overall VR headset purchases declined in 2024. Meta introduced AI-enhanced Ray-Ban glasses with cameras, speakers, and voice control to broaden appeal. Apple's anticipated entry into AR wearables poses a major competitive threat due to Apple's consumer reach, hardware-software integration, and ecosystem advantages.
Read at The Motley Fool
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