Metaverse stocks Nvidia and Roblox fall as Facebook parent Meta's Web3 business reports massive loss

• A massive loss in Facebook-parent Meta's Web3 division spurred a sell-off in metaverse stocks.
• Chipmaker Nvidia and gaming platform Roblox both fell in the aftermath of the earnings report.
• Meta wiped out more than $200 billion from its market value Thursday.

Metaverse stocks like Roblox, Matterport and Nvidia got a reality check after Facebook-owner Meta reported a massive loss in its Web3 business.

In Meta's fourth-quarter earnings posted late Wednesday, the Facebook-parent said Reality Labs, the division behind the company's metaverse technology, reported a $10 billion operating loss and a revenue miss for 2021.

The report spurred a slump in companies such as gaming platform Roblox, chipmakers Nvidia and Skyworks, software company Adobe, fintech firm Block, and gaming-software creator Unity, among others.

Roblox, a video game for building digital worlds, fell as much as 9% Thursday to $60.17, adding to an approximate 38% dip so far this year. The slump set shares below their opening price of $64.50 nearly a year ago when the company went public via a direct listing.

Matterport, which says its technology is used to turn "real-life spaces into immersive digital twin models," sold off 6%. Nvidia and Skyworks, the makers of semiconductors powering virtual worlds, dropped as much as 3% and 4%, respectively.

Block, the payments company formerly known as Square, has been increasingly focused on bitcoin and blockchain, the technology behind cryptocurrencies and the future internet known as Web3. Shares of the company slumped as much as 8.3% to $104.30. Meanwhile, Adobe and Unity, which have been dubbed solid metaverse software plays, fell as much as 3.6% and 7%, respectively.

Japanese gaming company Nintendo lost 2%. Though the company is being cautious about investing in virtual worlds, some consider it an under-rated metaverse stock, CoinDesk reported.

As for Facebook, the social media giant tumbled 26% Thursday, wiping out more than $200 billion of its market value and swiping billions from Meta boss Mark Zuckerberg's net worth. The disastrous Meta earnings spurred more woes for tech stocks as the Nasdaq fell as much as 2.7%.

Last year, the company formerly known as Facebook rebranded to Meta as a sign of its push into the metaverse, a virtual world in which people can interact as avatars. Critics have said the Facebook parent is behind the curve from other companies already pouring into virtual worlds, while others have said the metaverse is meant to be owned by users instead of tech giants.