Investors just handed Meta a $69 billion reward for scaling back metaverse spending

• Investors are cheering Meta's latest cost-cutting move.
• The social media giant is reportedly gearing up to slash spending in its metaverse unit.
• Despite betting big on the concept a few years ago, the metaverse has been a money loser for Meta.

The move: Meta Platforms stock spiked on Thursday, with the social media company seeing $69 billion added to its market cap, bringing its total value to $1.68 trillin. The stock rose as much as 4%, and is up 13% year-to-date.

The chart:

Why: The stock's most recent surge follows a report from Bloomberg that the company plans to scale back its metaverse efforts, with executives set to slash budgets in that part of the business by 30%, according to the report.

When the company changed its name from Facebook to Meta Platforms in October 2021, CEO Mark Zuckerberg framed metaverse technology as its future. The buzz around the technology ultimately faded shortly after the company's rebranding, and despite its namesake, the company has pivoted hard to AI in the last few years.

What it means: It's another indication that Meta views the future primarily through the lens of AI.

Despite Zuckerberg's historic bet on the metaverse and his belief that it would play a key role in the future of tech, the company hasn't seen much of a return.

The Reality Labs Division has been a money loser for Meta, with losses reaching $70 billion since 2021, according to Bloomberg. On Meta's most recent earnings call, the metaverse wasn't mentioned once.

The market's response to Zuckerberg's decision to shift focus away from metaverse spending makes it clear that Wall Street isn't lameting the reduced focus on the metaverse, as investors continue to see AI as the dominant force in tech and the broader stock market.

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