Meta Platforms, Inc. (NASDAQ: META), which changed its name and ticker to reflect its pivot toward the metaverse, is not seeing much traction on that front, according to tech analyst Ming-Chi Kuo.
The TFI International Securities analyst said Meta's metaverse hardware/headset business has slowed. He cut his shipment forecast for the category by 25-35% to 7 million-8 million for 2022.
The order cut, according to the analyst, is mainly in the second-half. Given Meta's reduced hardware investment and the economic recession risk, he cut his prediction for second-half Meta VR/headset shipments by 40-50%. Shipment of Meta headsets originally scheduled in/after 2024 will likely be postponed, he added.
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Kuo also updated his predictions about the higher-end Meta Quest 2 Pro VR headset. The analyst reiterated his expectations for the adoption of mini-LED displays and 2P Pancake for marked visual improvements.
He also expects VR and AR support and the adoption of about 16 cameras, including 10 for the headset and six for the two controllers.
The headset will likely use Qualcomm, Inc.'s (NASDAQ: QCOM) XR2 processor and offer eye-tracking, facial expression recognition and 3D-sensing support, Kuo said.
The analyst expects the headset to go into mass production in the third quarter, with shipments likely to hit two million units in the second half of the year.
Meta will likely price it at $799 or higher, he added. This is a lot cheaper compared to the $3,000 Apple's AR headset is widely expected to cost.
Price Action: Meta closed Tuesday's session down 4.09% at $157.05, according to Benzinga Pro data.
