Meta's Smart Glasses: A Low Volume Product with Limited Revenue Potential

Moor Insights & Strategy analyst Anshel Sag believes Meta's smart glasses will be a "low volume" product, unlikely to generate significant revenues or profits. Despite this, Sag sees the product as a thought-provoking and industry-paving innovation that will help people reduce phone usage. The company's Reality Labs arm is pursuing next-generation augmented and virtual reality hardware, and its Family of Apps averaged 3.4 billion daily active users in March 2025.

Meta Platforms, Inc. (NASDAQ: META) has been making significant strides in the realm of augmented and virtual reality (AR/VR) hardware through its Reality Labs division. A recent analysis by Moor Insights & Strategy analyst Anshel Sag suggests that the company's smart glasses will likely be a "low volume" product, potentially generating limited revenues and profits. Despite this, Sag sees the product as an innovative and industry-paving development that could help users reduce their reliance on smartphones.

Meta's Reality Labs division is focusing on next-generation AR and VR hardware, with the company's Family of Apps averaging 3.4 billion daily active users in March 2025. The smart glasses, which are part of this division, are expected to be a low-volume product, according to Sag. This means that while the smart glasses may not generate substantial financial returns, they could have a significant impact on the technology industry by reducing phone usage and paving the way for new innovations.

Sag's analysis highlights the potential of Meta's smart glasses to revolutionize how people interact with technology. By offering an alternative to smartphones, the smart glasses could help users reduce screen time and improve their overall digital experience. This is a significant development, especially in an era where the average person spends a considerable amount of time on their phones.

However, it is essential to note that the smart glasses are just one part of Meta's broader strategy. The company is also investing heavily in artificial intelligence (AI) infrastructure and the metaverse, which could generate significant revenues in the long term. Meta's Q2 2025 results showed strong ad revenue growth driven by AI recommendations, with daily active users across its apps reaching 3.48 billion.

In terms of financial performance, Meta's stock has been volatile in 2025. The stock opened the year near $598, hit a record $789.47 on August 12, and closed September 30 at $734.38, delivering a ~25 % year-to-date gain. Technical indicators suggest that the stock has cooled after its summer rally, with the relative strength index (RSI) sitting near 40, indicating neutral momentum.

Meta's valuation metrics are robust, with a forward P/E of ~25.75 and a price-to-sales (PS) ratio of 10.37. The company's return on equity (ROE) is a robust 40.65 %, and its debt-to-equity ratio is low at 0.25. However, the company faces significant regulatory and legal challenges, including the European Union's Digital Markets Act (DMA) and ongoing antitrust suits.

In conclusion, while Meta's smart glasses may not generate significant revenues or profits, they represent an innovative and thought-provoking development in the technology industry. The product could help users reduce phone usage and pave the way for new innovations. However, it is crucial for investors to consider the broader context of Meta's financial performance and the regulatory challenges it faces.