Meta Platforms Inc (NASDAQ: META) shares came under pressure in 2022 due to cost concerns after the company rebranded from Facebook and laid out a new vision for the future focused on the metaverse. 2023, dubbed the "year of efficiency" for Meta, helped put those concerns to rest as the company leaned into AI.
Although Meta's metaverse ambitions are not currently in focus for the Street, Meta continues to attract VR employees with outrageous salaries.
What To Know: According to a Washington Post report citing people familiar with the matter, Meta is paying programmers capable of creating virtual reality-related tech abnormally high amounts ranging from $600,000 to nearly $1 million annually.
Meta is paying "significantly more" than most other gaming companies, according to Patrick McAdams, CEO of Andiamo, a data-driven tech recruiting firm.
"It's not an exaggeration to say that their total compensation is double or more than double of what you'll get at a large gaming company," McAdams said.
Meta spent approximately $10 billion on its metaverse build out in 2021, another $15.9 billion for its Reality Labs division in 2022 and another $16 billion in 2023. The metaverse-focused business lost about $4.5 billion in just the second quarter this year, Meta said at the beginning of the month.
Why It Matters: It appears a significant portion of its metaverse and VR spending is going toward offering eye-popping pay packages to programmers. The report indicates that Meta is willing to pay "unusually high salaries" in order to get the best developers to work for the company instead of for competitors.
A former recruiter for the Mark Zuckerberg-led company told the Washington Post that there usually wasn't much competition on the offers they made because they would "pay way above market rate" for several roles.
Of all the VR developers that were offered jobs at Meta in recent years, the average compensation was nearly $540,000. For comparison, Apple Inc's (NASDAQ: AAPL) highest pay packages for VR developers were a little below $500,000 and Alphabet Inc (NASDAQ: GOOG) (NASDAQ: GOOGL) reportedly paid its top-tier developers approximately $440,000.
One executive from a smaller gaming company said he was unable to hire a senior developer last year because Meta had offered the candidate $800,000 per year with a performance bonus that could see total compensation rise to about $1 million.
"This candidate was a senior [developer who didn't have] super unique experience [or] skills. Facebook was doing pretty wild stuff a year ago," the executive reportedly said.
META Price Action: Meta shares are up approximately 48% year-to-date, according to Benzinga Pro.