Oculus is on fire, and the popularity of the Metaverse will continue

On Christmas Day, the most popular app in the Apple App Store is the “Oculus” app from Facebook’s parent company Meta (FB). The Metaverse is still very hot.

Every year around Christmas, people will continue to activate the new devices they have acquired. At this time, Apple’s App Store software download rankings have become a good opportunity to learn about new technology trends.

We found that on Christmas Day, the most popular application in the Apple App Store was the “Oculus” application from Facebook’s parent company Meta (FB).

Oculus is on fire, and the popularity of the Metaverse will continue

Before the holidays, the application software “Oculus” used to activate Oculus VR head-mounted display devices was still ranked outside the top ten, and after Christmas Eve on December 24, the application jumped directly to the first place. This proves from the side that this During Christmas, many people bought Oculus VR head-mounted display devices.

Oculus is on fire, and the popularity of the Metaverse will continue

This VR headset naturally comes from Meta; in 2014, Facebook, now renamed Meta Platforms Inc (FB), acquired Oculus for US$2.3 billion. It has become the core of Meta’s transformation from a social media giant to a metamedia pioneer. In October of this year, Meta CEO Mark Zuckerberg stated that he would invest at least US$10 billion to build the metaverse, and elaborated his vision for the metaverse, namely, an immersive next-generation Internet version driven by virtual reality and augmented reality. It is believed that this virtual world will become the standard for social networks, games and even work in the future. Zuckerberg used Oculus goggles to show a detailed but yet unconstructed vision of time and space.

Oculus is on fire, and the popularity of the Metaverse will continue

After its VR products became popular during the Christmas holidays, FB’s stock price soared 3.26% on the first opening day after the holiday.

KeyBanc analyst Paterson wrote in a report that Oculus’s success during the Christmas period may also be due to a shortage of video game consoles, such as Sony’s PlayStation 5 and Nintendo’s (NTDOY) Switch OLED. Global chip shortages and high consumer demand make it difficult to buy game consoles that have always been popular as holiday gifts.

Meta did not immediately respond to a request for its holiday sales data, but its device is one of the most popular in the VR field. Oculus is cheaper than most competitors—for example, htc’s Vive Pro 2, which retails for $799—and is considered the industry standard.

Since Facebook changed its name to Meta Platforms and announced that it will focus its strategy on “Metaverse”, the market’s enthusiasm for the concept of “Metaverse” has soared, and a pioneering new Internet era is about to emerge.

So, in 2022, will the Metaverse continue to explode?

First of all, although the concept of “Metaverse” seems to be far away from us, some parts are already on the way to realization, including hardware such as Meta’s Quest, Microsoft’s (MSFT) HoloLens helmet, as well as “Fortress Night” and Roblox ( Game platforms such as RBLX) have existed for a long time and are very popular with players.

From the perspective of Meta’s Oculus helmet, because Facebook is a global social media giant, the huge user base allows the company to collect more data about users’ use of virtual reality, and based on these data to further customize and improve users’ favorite virtual devices.

Oculus is on fire, and the popularity of the Metaverse will continue

Moreover, although the company has not announced the sales data of helmets, after the equipment sales this year, the new VR user group can further help Meta and other companies engaged in similar technologies to optimize the next product. This technology is indeed expected to reach a turning point that attracts consumers and software developers like smartphones and computers.

What may cause controversy is that Amazon (AMZN), Google (GOOG) and Fitbit have used similar VR products to sell at Christmas in the past few years, but they ultimately failed to change the rules of the game with VR, but no matter what, The success of Meta’s sales during the Christmas period alone is enough to take it as a strong signal-Meta’s “Metaverse” path seems to be on the right.

In addition to Meta, US technology giants are all following up on “Metaverse” investment

Trendforce estimates that the annualized shipment of AR/VR will grow at a compound annual growth rate of 38.8%, reaching 25.76 million units in FY25. If Meta’s Oculus can maintain its leading position in the consumer field, its market share will reach 66% in 2022. However, the company may face fierce market competition, especially with Apple.

Apple previously expected that it will launch an augmented reality VR headset sometime next year, and market analysis believes that this headset may become a catalyst for people to further accept the “Metaverse” world.

In addition, Sony will also release PSVR2 in 2022. Previous news shows that PSVR2 will provide a resolution of 4000×2080 pixels (2000×2040 per eye). In addition, PSVR2 will also include the ability to achieve pit rendering. The gaze tracking, the lens separation adjustment dial, and the vibration motor that allow developers to provide direct tactile feedback. In short, this system will give Sony’s PS5 platform a qualitative leap in performance, interactivity and user experience.

Oculus is on fire, and the popularity of the Metaverse will continue

In addition, Nvidia (NVDA) also proposed its own Metaverse world-OmniVerse, which is a powerful real-time collaboration simulation platform, which allows artists to use the cloud between software, local or anywhere in the world, real-time Work seamlessly. Omniverse can be applied to many fields such as construction engineering, autonomous driving, media and entertainment, manufacturing, etc. As artists, designers, engineers and researchers integrate technologies such as global illumination, real-time ray tracing, AI, computing and engineering simulation into their daily lives In the work process, the heavy-duty 3D production process has become increasingly complicated. Utilizing the Omniverse stack can improve the flexibility and scalability of industry workflows.

Oculus is on fire, and the popularity of the Metaverse will continue

In 2022, Wall Street’s layout of the Metaverse will still be hot

Although it has experienced a surge in 2021, Wall Street investment institutions are still paying close attention to investment opportunities in the Metaverse. Investment bank Jefferies may be the most excited.

Simon Powell, a securities strategist at Jefferies, believes that Metaverse is an investment opportunity similar to the early Internet. All human activities that have not yet been transferred to the Internet will be transferred in the next 5 to 10 years. As it develops, it will subvert mankind. In the form of life, investors should invest in Metaverse, as if they were betting on the beginning of the Internet.

Simon also suggested that investors should focus on chip manufacturers such as Nvidia and AMD, because building a virtual world will require a huge amount of computing power.

So, whether FB stock is bought or sold

Oculus is on fire, and the popularity of the Metaverse will continue

Oculus is on fire, and the popularity of the Metaverse will continue

The current EV/NTM profit before interest and tax (EBIT) of FB stock is 19.3 times, which is consistent with its 3Y average of 19.1 times. Therefore, we believe that stocks are not expensive. However, its adjusted EBIT is expected to decline significantly because of the meta-field opportunity of rising capital expenditures. However, its adjusted EBIT is expected to continue to move forward strongly. In addition, we believe that, in the long run, these investments are necessary to achieve its transformative Metaverse goals.

Oculus is on fire, and the popularity of the Metaverse will continue

It is worth noting that its price currently has an implied upside potential of 20.1% over the consensus price target. This may be the most significant valuation gap between the consensus target and its stock price since COVID-19 bottomed out. The stock also found strong support near its key 50-week moving average. Therefore, we believe that there is enough convergence point for us to reiterate our buy rating on FB stock to long-term investors.

Posted by:CoinYuppie,Reprinted with attribution to:https://coinyuppie.com/oculus-is-on-fire-and-the-popularity-of-the-metaverse-will-continue/
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