Guo Mingchi: META's hardware losses in the metaverse may be higher than market consensus.
Tianfeng's well-known analyst, Guo Mingji, wrote that the hardware business of META's head-mounted device (metaverse) may incur higher losses than market consensus due to weak demand.
According to the information obtained from the Zhitong Finance APP, renowned Tianfeng analyst Guo Mingji wrote an article stating that the hardware business of META (META.US), the head-mounted device (metaverse), may incur higher losses than market consensus due to weak demand. According to Guo Mingji's latest survey, the shipment volume of META's head-mounted devices/metaverse hardware has continued to decline significantly, so the downsizing of the head-mounted device/metaverse business has limited help in improving losses.
Guo Mingji pointed out that the initial shipment estimate for Quest 3 was expected to exceed 7 million units in 2H23, but due to weak demand expectations, the current shipment estimate for the second half of this year is 2-2.5 million units, and the shipment volume in 2024 is about 1 million units. The shipment volume of the Quest series is expected to further decline by about 50% YoY to 3.5 million units in 2023, and there may still be a YoY decline in shipment volume in 2024.
Guo Mingji also stated that even with improvements in specifications/functionality as selling points, the estimated total shipment volume for the entire lifecycle of the new Ray-Ban Meta Smart Glasses is only about 1.5 million units, which is lower than the initial shipment target of 2 million units for the previous generation Ray-Ban Stories Smart Glasses. However, it is worth noting that the final shipment volume of Ray-Ban Stories Smart Glasses was only about 300-400 thousand units, significantly lower than expected, and the actual number of active users was even lower than 50 thousand.