Recently, Roblox and Meta released their fourth-quarter financial reports, and the stock price fell sharply a day after the earnings report. As the world's sixth-largest company with a market capitalization of more than $1 trillion, Meta's stock price plummeted by 4%, the market value fell to $565 billion, and even fell out of the world's top ten, ranking eleventh; coincidentally, the other meta-universe concept stock Roblox, the stock price fell 26.41%, the current market value of $312.22.
The concept of the "metacosm", which originated in 1992, set off a boom in the metaverse of everything 30 years later. In 2021, domestic and foreign technology giants, Internet giants have embraced the meta-universe, not only that, games, social networking, real estate and other fields can see the figure of this concept, but "fragrant food" also has a cold time, so many media began to advocate the meta-universe bubble is extinguished.
Metaverse is not a company nor a technology, but an idea and an industry, involving artificial intelligence, display technology, blockchain technology, etc. at the technical level, and art, games, movies and other fields in terms of application scenarios.
It is precisely because of the breadth of its connotation that the hype of people with hearts has increased the market's doubts about the metaverse, but is this really the case? Will the embryonic metaverse still heat up in 2022? And how should we view the collective decline of meta-universe concept stocks?
The main reason for the decline in the metacosmonic "concept stocks"
At present, some media feel that the metaverse is not working, and one of the reasons is that the metacosmum plate is falling back from the high point. Since January 6, the metaverse concept has opened a downward mode, after a brief decline, the second wave of decline is very large, and now it has fallen by 20%, combined with the recent meta and Roblox falls, it seems that it really looks like some media said that "the metaverse has gone"?
But in fact, if we look at the recent performance of the US stock market and compare it with the meta-universe concept plate, we will find that the trend of the meta-universe concept is the same as the trend of the US stock market.
Therefore, the trend of the metacosm concept is mainly affected by the US stock market, and the US stock market is affected by the macro economy. Therefore, only by understanding what has recently happened at the macro level can we more clearly understand why the metacosm concept behaves the way it is.
Affected by the epidemic, the United States announced on March 23, 2020, the launch of an unlimited quantitative easing program to stimulate the economy, and then opened the printing mode. Although this approach has indeed sustained the U.S. economy for nearly two years, and the U.S. stock market has risen with it, the unlimited amount of quantitative easing has increased by more than four trillion dollars in one fell swoop, and it has also created rising prices, and the U.S. economy has been difficult to bear such inflation.
Therefore, near 2022, the United States has repeatedly discussed whether to reduce inflation in the United States by raising interest rates, and in November 2021, the Fed interest rate meeting officially announced the launch of Taper (asset purchase reduction).
Still, it's coming. On January 5, the Fed released its first minutes at the beginning of the new year, which revealed pessimism about the economic outlook for 2022.
In addition, the Fed will speed up the reduction of quantitative easing, of course, this point the market has long expected, and has been digested almost, but more importantly, in this meeting minutes, specifically mentioned the balance sheet reduction, the balance sheet reduction rate can be faster than the previous cycle, according to the Fed meeting minutes sentiment indicators, the Fed FOMC meeting minutes for the third consecutive time has become more hawkish.
Affected by this, the S&P fell nearly 2% on the day, and the NASDAQ fell more than 3% in a single day, and then opened a round of big declines.
On the other hand, in order to solve the internal problems of the United States, the United States often creates external problems, and the recent Ukrainian-Russian problem is an economic problem involving the United States, Russia, and Europe.
The core problem is that interest rate hikes are a means that the United States must use, but if the US economy is regulated by raising interest rates in a tough way, then the US capital market will usher in a storm, which will affect Biden's midterm elections.
Then other means must be used so that the rate hike can be implemented in a softer landing way. For example, allowing the dollar to flow back is a means to ease interest rate hikes, but at present, China is a monolith and cannot drill a seam, so it is most likely Europe.
On January 19, The Lancet, a top medical academic journal, published a paper by Murray, director of the Institute for Health Metrics and Evaluation (IHME) at the University of Washington. The paper predicts that the global pandemic of the new crown virus is coming to an end and That March will be a key point in time.
Subsequently, more and more "March has become a key point in time for the end of the new crown epidemic world pandemic" this view has been recognized by all countries, many countries have begun to relax the epidemic prevention policy, at least 30 countries around the world have proposed or have relaxed the epidemic prevention policy, European countries are the earliest to unblock, the largest number. Therefore, with the epidemic in Europe basically ending, the euro economy is gradually recovering, which is a huge obstacle to the return of the US dollar, so Europe cannot be so stable, so there is today's Ukrainian-Russian problem. The Ukrainian-Russian problem eventually achieved its effect, with expected rate hikes falling and the dollar returning, but the capital market was more miserable.
Industry stock situation
After looking at the overall macro market, let's briefly look at the specific situation of the metaverse concept stocks represented by Meta and Roblox, and carry out a simple disassembly from the local.
Meta
Let's talk about Meta again, Meta announced its fourth quarter of last year on February 2, 2022, which is the first financial report since The renaming of Meta from Facebook in October 2021, and the first time it has announced the revenue of its Reality Labs.
Focusing on producing virtual reality (VR) and augmented reality (AR) hardware and software, including virtual reality headsets such as Quest and virtual reality platforms such as Horizon Worlds, Reality Labs, dedicated to building pairs of unlinked links in VR and AR, is the division that carries Zuckerberg's vision of the metaverse. The performance of Reality Labs is undoubtedly an intuitive demonstration of how Me Metaa behaves in the direction of the metacosm.
Although Meta recorded revenue of $33.7 billion in the quarter, an increase of 20% over the same period in 2020, a closer look at the details reveals that Reality Labs lost $3.3 billion in the fourth quarter and a net loss of $10.19 billion for the full year of 2021, which seriously weighed down Meta's overall profitability, and if Reality Labs is removed, Meta's full-year profit can exceed $56 billion.
But Meta is a big business, and you can't just rely on the performance of one of these divisions to determine what to expect from it. The reason for Meta's sharp drop on the day of the earnings report is mainly due to some of its overall situations, such as insufficient profit and number of users in the fourth quarter, and the performance of the first quarter is not good, and the daily active users (DAUs) on meta fell slightly in the fourth quarter, which is the first quarterly decline in DAU on record.
Therefore, the decline in profits, the number of users did not meet expectations and other operating data eventually led to investors' expectations of Meta, which led to this big fall.
However, the situation of individual stocks varies from person to person, and it cannot be said that the entire metaverse industry is the same in a partial generalization.
Roblox
If Meta is an integrated company with not enough elements in its metacosm, Roblox is a company with 100% metacosmic elements, and its performance may be more telling.
First of all, from the trend point of view, in the past two months, Roblox is still following the general trend of the US stock market, which once again reflects the impact of the macro economy on micro stocks.
Secondly, it is a more important time node - on February 15, Roblox announced the fourth quarter of 2021 financial results and full-year financial results, and a number of data were also less than expected.
Revenue for fiscal 2021 was $1.9 billion, up 108% compared to fiscal year 2020, with a net loss of $491 million in 2021 and a net loss of just $253 million in 2020, with a widening loss gap. Among them, the company's total bookings for the fourth quarter were $770.1 million, which was 20% year-on-year, but lower than Wall Street's estimate of $786.2 million.
User performance also fell short of market expectations, with daily active users reaching 49.5 million in the fourth quarter, up 33% year-over-year, slightly below analyst expectations of 50.5 million, and bookings of $771 million, up 20% year-over-year, but also falling short of analysts' expectations of $772 million.
A big reason behind this is that the impact of the epidemic is gradually decreasing, countries have lifted the epidemic restrictions, schools have reopened, outdoor activities have increased, and the student group as its main user group has been greatly affected, which in turn has affected Roblox's data.
But other figures are also supporting Roblox, such as $2.7 billion subscriptions, up 45% year-on-year; daily active users of 45.5 million; Total user engagement hours were 41.4 billion, up 35% year-on-year; the average daily active user subscription was $59.85. Therefore, the performance of the capital market cannot fully reflect the future development of Roblox, and it is also very possible to accumulate and develop.
Domestic metacosmic stocks
So how are domestic metacosmic stocks performing?
Whether it is the so-called leading Zhongqingbao, or the world show with a high degree of topic, or goertek shares oem for Oculus and PSVR, its trend is very much in line with the trend of the US stock market, and whether it is the big fall of Meta or the big fall of Roblox, it has failed to have a significant impact on the domestic meta-universe stocks.
In fact, from the performance of these enterprises, the most important influencing factors of the capital market are mainly economic or political factors at the macro level, and then focus on the performance of the enterprises themselves.
At present, the performance of the overall capital market is sluggish, and it cannot be said that the metaverse concept stocks have collapsed collectively like some media, and it cannot be directly concluded that the metacosm is a bubble. So how to correctly view the performance of Meta, Roblox and other companies in the capital market? Is the metacosm a flash in the pan?
Is the metacosm a flash in the pan?
Of course, with the "collapse" of the metaverse concept stock, the comments about the metacosm is hype and fool's outlet have begun to be endless, just like the scolding of the mother when the stock price falls, the sky when the stock price rises, the psychological mood completely follows the K line, but about the direction of the metacosm we cannot deny, it will not be stagnant because of the stock of a company, nor will it be stagnant because of some negative comments, just like the Internet in 2000, even if the bubble bursts, It is still the most ambitious scientific and technological innovation of the past 20 years.
Of course, regarding the negative comments or reports of the metaverse, we still spare no effort to make the following three aspects of consideration here in response to the curiosity of the melon-eating masses.
1. Stock prices and financial reports do not represent the direction of the industry
First of all, we need to have a clear premise, stock prices and financial reports in most cases do not represent the direction of the industry problem, especially in some early industries, the stock price can only reflect the development status of a company, just like the Internet industry, 20 years ago may have been a high market value of the company has now disappeared, but also gave birth to a number of high-value Internet technology companies like Google, Amazon, Tencent, Ali.
Even if you go back to the stock market itself, there is always a deviation between price and value, and such deviation has created investors' profits or outs, so the value of the meta-universe industry is even less likely to be evaluated by several listed companies that are still in the early stages, and it cannot be determined by which listed companies that rub the meta-universe concept, so it may be slightly biased to comment on the industry by looking at the stock price and temporary financial reports.
2. The demand for the digital economy is strong and the trend is unstoppable
Secondly, the metacosm represents not only the so-called virtual economy, but also a manifestation of the digital economy, taking the domestic as an example, according to the "14th Five-Year Plan" in the planning of the digital economy, 7 key industries have been demarcated, including cloud computing, big data, internet of Things, industrial Internet, blockchain, artificial intelligence, virtual reality and augmented reality, these seven industries will also undertake the core industries of the digital economy Added value to gdp from 7.8% in 2020 to more than 10% in 2025 The heavy responsibility of the goal.
In 2020, the scale of China's digital economy will reach 39.2 trillion yuan, accounting for 38.6% of GDP, maintaining a high growth rate of 9.7%, becoming a key force for stabilizing economic growth. It is estimated that the size of the digital economy market will exceed 43 trillion yuan in 2022.
From a global perspective, the scale of the digital economy in 2020 will reach 32.61 trillion US dollars, accounting for 43.7% of GDP, which shows the importance of the digital economy, and according to IDC, the output value of the digital economy will account for 62% of global GDP by 2023.
To know that the technology behind the metaverse, whether it is 5G, cloud computing, blockchain, virtual reality or artificial intelligence, etc. are included in the digital economy, this trend is an important development direction in the next few years, not to be underestimated, so the meta-universe bubble theory is not self-defeating.
3. It takes time for technology to mature, but large capital and large enterprises will accelerate their development
Although the metaverse has experienced the "hype" in 2021, the current metacosm is slightly calm, but this calm does not mean that there is no progress and development, according to the life cycle of new technologies, we may still be in the "budding period of technology" to the "expected expansion period" of development, so the so-called hype may not have ushered in the real outlet, it does seem more conceptual.
However, we have seen many well-known companies begin to lay out the meta-universe, whether it is Microsoft, Apple and Meta such trillion-dollar technology giants, as well as many innovative companies have also joined the ranks of the meta-universe, which has also brought about a series of venture capital investment funds, and the amount of financing is also expanding, we have reason to believe that with the addition of these large enterprises and innovative companies, the meta-universe will usher in a new round of outbreak.
Of course, the current embryonic period of the metacosm needs more investors and entrepreneurs who really understand the value of this industry to enter, otherwise no matter how much money enters, it is also a kind of carnival and hype, which will naturally deviate from the actual value, which is also the reason for the decline in the stock prices of some speculative meta-universe concept listed companies.
Looking to the future
Whether it is the impact of the epidemic, or the current tension in European relations or the interest rate hike in the United States, it can be seen as a small wave in history, and pulling them to a long historical time, their impact will only be temporary, but the change brought about is the turn of the tide, and the role of the metacosm is more like the product of this big wave, we are in it, but we can't know.
Maybe The stock prices of Meta and Roblox will fall, but in the face of an industry that has rolled more participants into it, we need to look at the present and imagine the future, otherwise we will stumble on our feet.
It is not an exaggeration to describe the present moment of the metaverse with the wonderful description of the English writer Dickens in A Tale of Two Cities: "This is the best of times and the worst; this is an age of wisdom, this is an age of stupidity; this is a period of trust, this is a period of doubt." ”
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