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According to this article [paywall], Mark Zuckerberg's Metaverse venture has seen $46 Billion in losses.

In spite of this, Zuckerberg himself has increased his net worth by $59 Billion.

But that's not the part that confuses me - what confuses me is the end of the article making this claim:

That hasn't hurt Mark Zuckerberg's net worth, though. With much of his fortune tied to Meta stock, his net worth has shot up 130% year to date as the stock has gained 136.8% this year.

If Mark Zuckerberg's value is tied up in stocks in Meta, and Metaverse has been hemorrhaging money, how has his stock been growing in value?

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    How is Zuckerberg making money, it how is Meta making money? There is no "Mark Zuckerberg" stock. Meta isn't his only investment. Businesses can take losses if they think they will get decent future returns from doing so, and those returns may not always be obvious ones; Zuckerberg may not actually care about taking some loss... Basically, you aren't asking the right question.
    – keshlam
    Nov 1 at 21:20
  • @keshlam That is a good point in making the distinction between the two - however my question really is about how the CEO of a company can be increasing his net worth by so much when the company he is CEO of is losing so much money. The distinctions you point out aren't flaws in my question, they are answers to it.
    – Zibbobz
    Nov 2 at 12:31
  • There are other measures of a CEO's success than current income. There's also the fact that CEOs are just plain expensive to hire and retain whether they turn out to have been the right choice or not, like many other major businesses decisions; the reasons for that are not unique to Z.
    – keshlam
    Nov 2 at 13:45
  • I’m voting to close this question because OP is clearly not Mark Zuckerberg so it really isn't an answerable personal finance or (personal) money question
    – MD-Tech
    Nov 2 at 20:39
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    I think the title and most of the question are misleading. Unless you completely misunderstand several things (making money vs. net worth, meta vs. zuckerberg, ...), your question could be boiled down to "Why has META stock been increasing when they are losing a ton of money?" Everything else is just confusing that point that you are trying to get at. If that isn't the question, I have no idea what your question is.
    – Jason Goemaat
    Nov 2 at 20:44

2 Answers 2

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Stock prices don't always go up and down just because their profits do. The stock price is the market's expectation of future profits, so it's quite common (especially in high-tech companies) for companies to have current losses but have the expectation to make profits in the future, which is what the stock price is based off of.

However, even in this case, Metaverse is only one division of Meta (nee Facebook). Meta has actually made profits as a whole, which further justifies the increase in stock price.

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  • Focusing on the first half of that answer, how is that determination that a company will increase in value made? What determines that a net loss of capital indicates a probable growth in the future, and how far into the future is that growth predicted?
    – Zibbobz
    Nov 1 at 17:45
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    Do some research on "fundamental analysis" which is way too broad for a simple answer in this forum. Companies can lose money in the short term while building products, a custom er base, etc that will result in long term growth. Amazon famously lost money for years while building out its infrastructure to increase its platform and customer base.
    – D Stanley
    Nov 1 at 18:42
  • @Zibbobz It's like trying to scout out college sports players to see who's going to make it to the pros. They lost a game: is it the beginning of their demise, or just one lost match on a upward-rocketing career. There's no obvious answer, and it's some people's entire careers to try to figure that out.
    – Alexander
    Nov 2 at 20:53
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When evaluating the performance of companies that are in mature markets most folks will be looking at efficiency, and competency of execution, which are arguably well reflected in the financial reports for the company.

If you are looking at companies that are attempting to introduce new technologies, or trying to shift long-standing consumer behavior, then the you are going to be more interested in the credibility of the story the company tells about why those shifts are important, and why they will be successful in pursuing them. A canonical example is Microsoft. Microsoft was always a profitable company, but in their early days simply looking at their financials wouldn't have distinguished them at all from the dozens of other microcomputer software companies, and placed them way behind the established mini and mainframe software vendors. However, Microsoft's vision statement was "A computer on every desk in every office and in every home, running Microsoft software." This was hilarious at the time, but they managed to pull it off. People who believed that the introduction of microcomputers was going to change the world and invested in Microsoft did incredibly well.

Riding waves of technological and social change is risky of course, and less quantifiable than standard value analysis. As a counter-example, WeWork was going to revolutionize the workplace and maybe even housing and education by making long term real estate investments and renting them out as short term as "lifestyle" co-working spaces. WeWork is probably going to file for bankruptcy next week.

A lot of people (not me) believed that VR was going to transform every aspect of people's lives, and Meta made a big investment in it. The result was arguably ludicrous, but some people still think that VR is the wave of the future. The payoff from catching these major technological/societal shifts can be huge, so people take big gambles.

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