Meta’s augmented reality and virtual reality hardware divisions have reportedly been instructed to reduce their expenditures by approximately 20% by the year 2026, according to reports from The Data.
According to a report by The Data’s Wayne Ma and Kalley Huang, they are also reporting on Meta’s release timelines for the Quest 4 and Quest Pro 2.
Quest 4 reportedly set to arrive in 2026, followed by the highly anticipated Quest Professional 2 in 2027.
Meta reportedly plans to release the Quest 4 headset in two variants by 2026, followed by the Quest Professional 2 in 2027, according to industry insiders and data analytics firm reports.
Meta has been investing tens of billions of dollars annually in its Reality Labs AR/VR division. Since publicly disclosing its financials in Actuality Labs’ autumn 2020 filings, the company has invested more than $50 billion in this business segment. Considering the entire expenditure since Facebook’s acquisition of Oculus in 2014, the cumulative spend may have approached a staggering $100 billion.
Meta dedicates more than half its Actuality Labs budget to researching and refining its still-unreleased AR glasses, a product category that remains pending in the company’s launch schedule. The majority of remaining expenditures are allocated to Quest headsets and the Horizon software platform, both still relatively nascent technologies far from reaching full maturity.
Meta’s actuality labs expenditure has consistently increased annually; yet, following The Data’s report, top executives, including Mark Zuckerberg, must now contemplate a course correction, initiating a protracted journey towards financial sustainability as the XR industry transitions from rapid growth to maturity. According to reports, Actuality Labs’ hardware teams were urged to reduce spending by 20% by 2026, with a significant portion of those cuts expected to occur this year.
Actuality Labs reportedly undertook significant restructuring measures throughout the preceding year, resulting in the elimination of multiple middle- and senior-level administrative roles, including over a dozen administrators and vice presidents.
According to reports, Meta has reorganized certain Actuality Labs teams focused on artificial intelligence (AI) by transferring them into the company’s broader generative AI groups, including a 140-member team working on AI-powered speech.
As noted by The Data, Meta’s withdrawal from AR/VR retreats may be viewed as an additional signpost indicating Actuality Labs’ gradual shift from its primary role as a research and development arm to a more commercially focused entity. Meta has successfully transitioned several PC-based computer vision and optics research projects from the laboratory to its Quest products, with Quest 3 marking an early milestone in this effort; it is likely that future Quest 4 models and Quest Pro 2 will further showcase these advancements.
