Meta, the company formerly known as Facebook, became the latest tech company to suffer a dramatic share price slump on Wednesday as it reported higher costs and slowing growth. Reporting its first earnings under its new name, the social media company revealed it had spent $10bn on its vision of the future – the “metaverse” – and warned it faced “headwinds from both increased competition for people’s time and a shift of engagement”. Meta’s share price dropped 20% in after-hours trading, a fall that would represent $175bn in value if it holds when trading starts again on Thursday. After a boom during the pandemic, shareholders have punished formerly hot tech companies including Netflix and PayPal for disappointing results. While Meta’s revenues were slightly higher than expected at $33.67bn for the last three months, it reported a slightly lower number of daily active users – 1.93 billion against 1.92 billion last quarter. Facebook’s growth has stalled in the US and Europe but the latest falls came from Africa and Latin America. Facebook announced it was changing its name to Meta last October. Co-founder Mark Zuckerberg wants to refocus the company on ambitious plans to build a virtual reality “metaverse”. Meta also revealed for the first time how much it had spent so far on its new strategy. The company’s Reality Labs division, which makes virtual reality goggles, smart glasses and other yet-to-be-released products spent more than $10bn in 2021. The spending dragged down quarterly profits by 8% and Zuckerberg has indicated that there is much more spending to come. The company set out a series of issues that could affect growth in the near term, including platform and regulatory changes, as well as tough comparisons to a year when online advertising was boosted by the pandemic. The move also followed a series of crises at the company which has been blamed for promoting fake news worldwide, stoking hostilities and invading privacy. On a call with investors Zuckerberg he was “proud” of the work the company had done last year but acknowledged the company faced tough competition for attention from rivals including TikTok. “Although the direction is clear our path ahead is not yet clearly defined,” said Zuckerberg. “Last year was about putting a stake in the ground about where we are heading. This year is about execution.”