Meta’s Reality Labs division incurred a staggering $19.19 billion loss in 2025, with similar figures expected for 2026. CEO Mark Zuckerberg is shifting focus from VR headsets and Horizon Worlds to AI-powered smart glasses, seeing them as the future.

Meta’s Reality Labs division, the very reason Facebook became “Meta” back in 2021, bled $19.19 billion in 2025. And the company’s message to investors during its Q4 earnings call this week was blunt: expect more of the same in 2026.CEO Mark Zuckerberg acknowledged that Reality Labs losses this year would be “similar to 2025 levels,” even after laying off roughly 1,500 employees from the metaverse-focused division earlier this month. The unit recorded its worst quarter ever in Q4 2025, losing $6.02 billion on just $955 million in revenue.

Zuckerberg pivots from metaverse to AI glasses and superintelligence

The Reality Labs cuts came with a strategic reshuffling. Meta is pulling money away from VR headsets and its struggling Horizon Worlds virtual social network, funneling it instead toward AI-powered glasses and wearables. The company shut down three VR studios, including Armature, Twisted Pixel, and Sanzaru, while moving its $400 million fitness app Supernatural into “maintenance mode.”Zuckerberg’s new obsession? Personal superintelligence delivered through your Ray-Bans. Sales of Meta’s smart glasses more than tripled last year, and the company is betting big on AI-equipped eyewear as the “ultimate incarnation” of its vision for the future. The pricier Ray-Ban Display glasses, featuring a built-in screen navigable via wristband, have seen “unprecedented” demand in the US.

Horizon Worlds gets a Roblox-style makeover for mobile

Rather than abandoning virtual worlds entirely, Meta is reimagining them. The company is actively courting Roblox developers to build experiences for Horizon Worlds, aiming to attract younger audiences through kid-friendly, AI-generated games that can be shared on social feeds.Zuckerberg hinted at a future where users could create entire games through a simple prompt and share them on Instagram or Facebook. The 3D experiences built for VR could pair with AI advances to reach “hundreds of millions and billions of people through mobile,” he said.One thing notably missing from the earnings call? The word “metaverse.”