Meta Reveals New VR Headset, Preempting Announcement by Apple

Meta Platforms Inc. (META) unveiled its latest virtual reality (VR) headset Thursday, just days before Apple Inc. (AAPL) is expected to jump into the ring with its own augmented reality headset.

Key Takeaways

Meta Platforms’ CEO Mark Zuckerberg unveiled the company’s latest VR headset, the Quest 3, ahead of an anticipated announcement of a rival set by Apple next week.
Meta’s new headset, the Quest 3, will be priced starting at $499 and is likely to hit shelves later this year.
Meta has invested heavily in VR technology, though its Reality Labs unit posted an operating loss of about $4 billion last quarter.
The company accounted for about 80% of the nearly 9 million VR headsets sold last year.

The new headset, called the Quest 3, will be priced starting at $499 and will feature “high-res color mixed reality” technology, according to an announcement from CEO Mark Zuckerberg on Instagram. The headset is expected to be almost twice as thin as its predecessor, 2020’s Quest 2, which cost $299. Meta is expected to provide more details about the Quest 3, including its official launch date, at its Connect conference in late September.

The virtual reality space is becoming increasingly competitive, with Meta competing against Playstation-maker Sony Group Corp. (SONY), TikTok-owner ByteDance, and, soon, Apple. The iPhone maker is expected to unveil its own augmented reality headset called Reality Pro at its annual developer conference next Monday. The headset is anticipated to be priced at about $3,000 and. will integrate with Apple’s other devices.

Still, the VR tech market is small relative to smartphones and other gaming tech. Fewer than 9 million VR and AR headsets were sold in 2022, with Meta accounting for about 80% of sales. Meta’s Quest 2 model is currently the most popular VR headset on the market, likely making up the majority of the 20 million headsets the company says it had sold as of March.

Meta’s Reality Labs unit, responsible for its VR and AR technologies, reported an operating loss of almost $4 billion in the latest quarter. The segment generated $339 million in revenue, a 50% year-over-year decline amid a dropoff in headset demand.

Meta shares were up 1.5% midday following the announcement.

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