If there’s one thing Mark Zuckerberg has proven over the past five years, it’s that he’s not afraid to splash out his cash for long-term bets. And now that future still looks like glasses.
At Meta Connect 2025, the CEO emphasized (again) his vision that extended reality (XR) will eventually replace smartphones. But according to Meta’s latest earnings, that dream continues to come with a hefty price tag.
The multi-billion dollar rabbit hole
Meta’s Reality Labs division, which owns the Meta Quest headset and Ray-Ban AI smart glasses, reported an operating loss of $4.4 billion in the third quarter. The division posted revenue of $470 million, beating Wall Street estimates, but did little to cushion the impact of a cumulative $70 billion in losses since the end of 2020.
Zuckerberg’s long-term bet
As Meta Connect 2025 demonstrated, Zuckerberg is betting big on the future of augmented reality wearables. AI-enabled smart glasses were the stars of the show, and the company announced its next-generation Ray-Ban collaboration and a new Oakley partnership. Mehta is betting that smart glasses will eventually completely replace smartphones, a vision that appears to be shared by Samsung and Apple. Despite significant losses, Zuckerberg is playing the long game, hoping the market will catch up to their technology.
Zuckerberg:
“Everyone who has glasses will upgrade to smart glasses very quickly over the next decade. Many other people who don’t wear glasses today will eventually wear glasses.”
A glimmer of hope behind the lens
Good news? Meta’s new Ray-Ban Meta Display glasses appear to be its first real hit. The glasses, released in September, come with an integrated display and a neural wristband that reads subtle hand signals. This is a leap toward Zuckerberg’s oft-repeated dream of “invisible computing.” The previous collaboration sold an impressive 2 million units despite its more competitive price of $299. This proves that people want wearable technology. They just want to look normal while performing wearable technology.
It’s a subtle but important change. The hype over virtual worlds may have cooled, but the technologies that underpin them (sensors, displays, neural interfaces) are finding new life in AI-driven consumer hardware. Rather than luring people into digital spaces, Meta appears to be bringing digital intelligence into the physical world.
Metaverse rebranding
Perhaps the clearest sign of Meta’s strategic shift came quietly this week. Vishal Shah, an executive who has led the company’s metaverse efforts, has been reassigned to Superintelligence Labs as vice president of AI products. In corporate terms, it is a reorganization. In industry terms, this is rebranding.
Meta doesn’t want to talk about the “Metaverse” anymore. Not because the metaverse is dead, but because it is evolving. The same technology that once powered Horizon Worlds now powers smart glasses that understand the environment, recognize objects, and adapt to people’s daily workflows. If the metaverse is about immersion, this new chapter is about integration.
A multi-billion dollar problem
Meta’s XR story remains one of huge investments and uncertain rewards. But this quarter offers the faintest hint that the tide may be turning. Consumers aren’t just believing in Zuckerberg’s long-term strategy, they’re starting to buy it.
The question is how long the game can last before investors lose patience. With $70 billion invested in Reality Labs and no profitability in sight, the company may not balance its books anytime soon, no matter how successful its AI glasses launch is.
Don’t expect Zuckerberg to blink first…