Meta Expands Physical Retail Presence as Virtual Spaces Close

Meta is reportedly expanding its physical retail push by opening a new Manhattan store.

The tech giant has signed a 10-year lease on a five-story building on Fifth Avenue, Bloomberg News reported Wednesday (March 18), citing a statement from the company.

Meta in 2024 tested a pop-up store in Los Angeles, and last year introduced its Meta Lab store, also in L.A. Per the Bloomberg report, this space lets visitors experiment with Meta’s artificial intelligence (AI) smart glasses and virtual reality headsets.

“We’re proud to make a long-term commitment to Fifth Avenue, the heart of US retail,” Matt Jacobson, vice president and creative director of wearables at Meta, said in the statement.

Bloomberg notes that this deal expands on what is already a substantial presence for Meta in New York City, with the company leasing space in the Farley Building in 2020. The company’s expanded presence in the physical world comes as its virtual worlds are shrinking.

Meta announced Tuesday (March 17) that after June 17 its Meta Quest virtual reality (VR) headsets would no longer be able to access the Horizon Worlds app, while Horizon Worlds would no longer be available in VR.

The company said these charges are part of a shift in focus for VR and Horizon that Meta announced last month.

“We are separating the two platforms so each can grow with greater focus, and the Horizon Worlds platform will become a mobile-only experience,” the company said in a blog post. “This separation will extend across our ecosystem, including our mobile app.”

The announcement follows a report from January that Meta was cutting 10% of the jobs in its Reality Labs division as part of a larger plan to lessen its focus on VR products as it invests more into other artificial intelligence wearables.

In other Meta news, the company this week formed a $27 billion infrastructure agreement with AI cloud company Nebius, which will see Nebius provide $12 billion of dedicated capacity across multiple locations.

The companies say this effort will involve “one of the first large-scale deployments” of the Nvidia Vera Rubin platform, with Meta agreeing to purchase additional compute capacity for up to $15 billion across a five-year period.

“We are pleased to expand our significant partnership with Meta as part of securing more large, long-term capacity contracts to accelerate the build-out and growth of our core AI cloud business,” Nebius founder and CEO Arkady Volozh said in the announcement. “We will continue to deliver.”