Meta plans price hike for its virtual reality devices, internal memo shows
In a recent internal memo, Meta executives revealed plans to raise prices on their virtual reality (VR) devices as part of a strategic shift aimed at ensuring the company’s long-term sustainability. Gabriel Aul and Ryan Cairns, leaders in Meta’s metaverse division, communicated that the company is facing new costs, including tariffs, which necessitate a change in their business model. They emphasized that while the devices will become more premium in price, this shift is intended to create a healthier business model that alleviates the pressure of relying on the success of any single device. The memo also highlighted the importance of delivering high-quality software experiences that align with the excellence of their hardware, indicating that the pace of new hardware releases may slow down.
Currently, the flagship Meta Quest 3 headset retails for $499.99, while the entry-level model starts at $299.99. This price increase comes at a time when Meta is also delaying the launch of its new mixed reality glasses, codenamed “Phoenix,” pushing the release from late 2026 to early 2027. The memo outlined three key themes discussed during a recent strategy meeting with CEO Mark Zuckerberg and CTO Andrew Bosworth: building a sustainable VR business, enhancing software experiences, and accelerating mobile development. Despite budget cuts of up to 30% for Reality Labs, the division responsible for Meta’s hardware, the executives reassured staff that the company remains committed to VR in the long term, aiming to align its business model and roadmap with these objectives.
Since rebranding from Facebook to Meta in 2021, the company has invested heavily in developing the metaverse, although its Reality Labs division has reported losses exceeding $60 billion. Despite these challenges, internal reports suggest that Meta has sold nearly 20 million Quest headsets, indicating a significant market presence. As Meta navigates these changes, it seeks to balance premium pricing with the need for high-quality software and a sustainable business model, positioning itself for future growth in the evolving landscape of virtual reality and the metaverse.
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Meta plans to raise prices on its VR devices to ensure long-term sustainability, per an internal memo.
Metaverse executives told staffers it will extend the replacement cycle of in-market devices.
Meta also aims to deliver high-quality software experiences alongside its virtual reality devices.
Meta
is planning to raise prices for its virtual reality devices, executives said in an internal memo seen by Business Insider.
Metaverse leaders
Gabriel Aul and Ryan Cairns
told employees that the company must “make a shift” in its business model to ensure long-term sustainability. This will include measures such as price increases, accounting for new costs like tariffs, and extending the replacement cycle of its in-market devices, per the memo.
“Our devices will be more premium in price going forward, but we’ll have a healthier business to anchor on and free ourselves from feeling existential about any singular device’s success,” Aul and Cairns wrote in the memo, shared with staff on December 4.
They also called for delivering high-quality software experiences to customers that can match the “excellence” of its devices, adding that this may mean “we ship new hardware at a slower cadence going forward.”
Meta did not immediately respond to Business Insider’s request for comment.
The company’s flagship virtual reality (VR) headset, the Meta Quest 3, retails for $499.99, while its entry-level model retails at $299.99.
The move comes as Meta
pushed back the release of its new mixed reality glasses
, codenamed “Phoenix,” from the second half of 2026 to the first half of 2027, as outlined in a product strategy note to staff that Business Insider previously reported.
The memo announcing the price increases from Aul and Cairns did not refer to its mixed reality glasses. The document outlined three major themes derived from a recent Reality Labs strategy meeting with Meta CEO Mark Zuckerberg and CTO Andrew Bosworth. They included how Meta can build a sustainable VR business for the long term, how it can build “world-class” software experiences, and how it can accelerate its pace on mobile.
They also sought to reassure staffers that it remains focused on VR. Earlier this month, Bloomberg reported that Meta plans to
make budget cuts
of up to 30% to Reality Labs, the division responsible for Meta’s hardware.
“We’re committed to VR for the long-haul so we need to align our business model and roadmap to an approach that will make this possible,” they wrote in the memo. “We’ve been working hard to bend the curve and accelerate ahead of the category’s natural growth rate, which means running multiple programs in parallel as well as carrying costs like tariffs and subsidies for content, GTM, and devices.”
Facebook rebranded as Meta in 2021 “to reflect who we are and the future we hope to build,” Zuckerberg
said
at the time as the company outlined its vision for the metaverse. Since then, Meta’s Reality Labs division has lost more than $60 billion. The company doesn’t disclose headset sales publicly, but according to a 2023 report from
The Verge
, citing an internal presentation, Meta had sold nearly 20 million Quest headsets by that point.
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