Apple Stock: Are Virtual Reality and the Metaverse a Flop?

Apple stock  (AAPL) - Get Free Report has been trading over the past few months mostly on the strength of the company’s execution; and over the past few weeks on macroeconomic worries and the eventual rebounds. But many investors count on new ventures and products to drive the share price over the long haul.

When looking for growth stories for Apple, mixed reality (AR and VR) is one area that many turn to. But tech peer Meta Platforms  (META) - Get Free Report might be proving the opposite: that the metaverse is far from being the at-scale opportunity that many thought would unfold in the foreseeable future.

(Read more from Apple Maven: Apple Stock: This Is The Only Thing That Matters, For Now)

Metaverse: a slow start

Only a few days ago, Meta unveiled its new mixed reality piece of hardware: the $1,500 Quest Pro.

However, things have not been going so well for the Menlo Park company in its metaverse efforts. The pricey headset is barely the main problem.

For starters, Meta has suffered plenty of criticism for thinking far out in the future, but failing to address the problems that it has been facing on its social media platforms today — for instance, the spread of malicious content. That perspective may be enough to turn consumers off to the new technology, at least for now.

Regarding the metaverse itself, Meta’s Horizon World platform has fallen way short of expectations. The Wall Street Journal has recently reported that signups have only reached 200,000, less than half of the company’s internal goal.

Of those few that are on the platform, many may be disappointed by what they have seen so far. Users have been mocking the overly simplistic design of the avatars, for example, including that of CEO Mark Zuckerberg himself.

Internally, there have been reports that not even Meta employees have adhered en masse to Horizon World. If Meta itself has to “hold managers accountable for their teams using it”, what can one expect of the average consumer adopting virtual reality and its current applications in the near term?

Apple: where’s the opportunity?

Apple has not failed as much as Meta has on mixed reality and the metaverse for one key reason: the tech giant has not done much about them. Simply put: if you don’t try, you don’t fail.

To be fair, a mixed reality device is widely anticipated from Cupertino, as I covered in more detail a few days ago. So, it is a matter of time until Apple finally enters the space — even if the first device launched, expected to be priced aggressively, may not appeal to the average retail consumer at first.

The question that remains is: will Apple revolutionize mixed reality and the metaverse, making it more appealing to the masses more quickly than Meta can? Or will Apple step into a severely underdeveloped industry that might still be many years away from becoming a meaningful and profitable business for the tech giants?

For now, some could reasonably argue that virtual reality and the metaverse are a dud. At the same time, it is probably too early to make definitive statements that may not age very well, given enough time.

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(Disclaimers: this is not investment advice. The author may be long one or more stocks mentioned in this report. Also, the article may contain affiliate links. These partnerships do not influence editorial content. Thanks for supporting the Apple Maven)