Facebook Stock Is Even Cheaper Than It Looks
The biggest news to come out of Facebook's (NASDAQ: FB) latest earnings report is its new reporting structure.
Starting in the fourth quarter, the company will divide its results into two segments, shedding more light on Facebook Reality Labs. The first segment is for its Family of Apps, including Facebook, Instagram, WhatsApp, and Messenger, which today represents the core of the business. The other is Facebook Reality Labs (FRL), the division that encompasses its augmented and virtual reality products or services. When CEO Mark Zuckerberg talks about the metaverse, he's talking about Facebook Reality Labs.
Facebook isn't just giving FRL its own line item. It's also plowing even more cash into the project, saying in the earnings call that the investment in Facebook Reality Labs would reduce operating profit by $10 billion next year. Only a handful of companies even generate that much in profit annually, so the fact Facebook is willing to spend that much on FRL, which is generating little revenue at this point, shows how strongly management believes in the metaverse opportunity. Zuckerberg believes it will be the next major computing platform.
Source Fool.com
