When it comes to Meta Platforms (META -1.41%), most people associate the tech giant with its Facebook, Instagram, or WhatsApp platforms. However, for CEO Mark Zuckerberg, his focus is increasingly on the metaverse -- an immersive digital platform being developed to better facilitate real-time human interaction.

Facebook, Instagram, and WhatsApp are some of the biggest and most profitable social platforms in the world. Meta Platforms records financial results for these under its family of apps segment. Looking just at this business, the financials are extremely compelling for investors. But investors can't afford to ignore Reality Labs, Meta Platforms' metaverse segment.

Mark Zuckerberg's $13.7 billion bet

In 2022, Meta Platforms' Reality Labs generated almost $2.2 billion in full-year revenue, making it one of the biggest metaverse players in the world. However, this segment generated an operating loss of $13.7 billion, meaning the company is spending way more money than it's making.

This $13.7 billion is in addition to an operating loss of $10.2 billion for Reality Labs in 2021, adding up to a two-year operating loss of $23.9 billion. And during this time frame, Meta Platforms has generated metaverse-related revenue of just $4.4 billion.

Here's what's even worse: It's reasonable to expect the company to spend money to grow a new revenue stream. However, Reality Labs isn't growing. In 2021, Reality Labs generated revenue of nearly $2.3 billion. But in 2022, revenue for Reality Labs dropped 5% to less than $2.2 billion.

In other words, Meta Platforms is paying an exorbitant amount of money for meager results.

Greater efficiency in 2023?

In the conference call to discuss financial results for 2022, Zuckerberg began by saying, "I want to discuss my management theme for 2023, which is the 'year of efficiency.'" Given that opening, investors might have expected him to say that the company was cutting spending on Reality Labs, considering its year-over-year drop in revenue. However, Zuckerberg later said in the call, "None of the signals that I've seen so far suggests that we should shift the Reality Labs strategy long term."

If there was any lingering doubt, CFO Susan Li completely erased it by saying, "On Reality Labs, we still expect our full-year Reality Labs losses to increase in 2023, and we're going to continue to invest meaningfully in this area given the significant long-term opportunities that we see."

Clearly, Meta Platforms isn't pivoting whatsoever from its investment in the metaverse. Regarding efficiency, management hopes to save money in other parts of the business, in part by continuing to invest in artificial intelligence to improve operations.

The silver lining for shareholders is that Meta Platforms -- even with heavy losses from the metaverse -- remains solidly profitable overall. It's just not as profitable as it once was, as the drop in the operating margin indicates.

META Operating Income (TTM) Chart

META Operating Income (TTM) data by YCharts

Companies have an obligation to shareholders when it comes to profits. If they don't have any good uses for excess cash, it should be returned to shareholders via dividends or share repurchases. However, if companies can create more than a dollar's worth of shareholder value for every excess dollar they keep, then that's the more favorable option for long-term investors.

For Meta Platforms, management strongly believes that the metaverse will be one of the great growth trends of this coming decade. And that's why it's investing billions of dollars to be at the forefront. If Meta Platforms is correct, then the $13.7 billion it invested in the metaverse in 2022 may indeed prove to be worthwhile in time. However, if the metaverse fails to catch on as the company expects, then it could end up being a colossal waste. 

Either way, it doesn't look like Meta Platforms' investments will pay off in 2023, given management's commentary for an increase in operating losses for Reality Labs. That's something for investors to keep in mind: This stock could struggle to beat the market until the metaverse trend starts picking up steam.