Facebook To Increase Oculus Production To 2 Million Units- Report
Facebook Inc. (FB) has boosted production on its Oculus virtual reality (VR) headset to nearly double the amount compared to last year.According to a July 15 report from Nikkei Asian Review, the social media site has reacted to the uptick in COVID-19 cases throughout the world by calling for a production increase in the second half of 2020. This would be an increase of 50% compared to its entire produced amount for all of 2019.Nikkei’s source says that “the production forecast for the second half of this year could reach at least two million units, which is already around 1.5 times more than its total production output last year.”Facebook bought Oculus for $2 billion in 2014. Meanwhile, other tech companies have also introduced their VR versions with Sony (SNE) launching its PlayStation VR in 2015. Additionally, HTC, Samsung Electronics, and Huawei Technologies all introduced various types of headsets later using smartphones for VR screens. Despite the competition, Oculus has become the market leader claiming near 35% market share.On a Q1 earnings call, April 29, Facebook CEO Mark Zuckerberg stated that ad revenue grew 17% annually during the quarter, while its other revenue was “driven primarily by sales of Oculus products.” He stated that Oculus reached $297 million for the quarter which was up 80% from a year ago. According to Zuckerberg, videoconferencing tools could “accelerate some of the trends” in VR despite Oculus’ use being primarily for video games. In light of the pandemic, game console makers like Nintendo (NTDOY) have experienced increased demand for its portable Nintendo Switch device amidst supply constraints. With government lockdowns in Malaysia and the Philippines, a shortage resulted in parts that led to overall delays in production. Third-party sellers cashed-in on the moment by selling the game device for more than double the price on…
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