Facebook (FB -0.67%) CEO Mark Zuckerberg is set to update investors on his plan to build the immersive Metaverse that he has pitched as the future of computing at the company’s first in-person conference since the start of the pandemic. But he’s also likely to signal how Meta plans to navigate this year of investor fervor shifting away from augmented and virtual reality technologies toward artificial intelligence, as companies have pulled back from their AR/VR ambitions in light of slow sales.

In a memo posted to employees on Monday, Meta CTO Andrew “Boz” Bosworth emphasized that building the Metaverse is still the core of the $10 billion-a-year investment in new tech that makes up its “Reality Labs” division. However, he said the current focus is cutting costs and streamlining projects to improve profitability and market share. The company is expected to unveil its latest headset, the Quest 3, at the event.

The headset comes three years after the launch of its predecessor and less than a year after it unveiled the Quest Pro, a more expensive model designed for enterprises. It could be a sign that the social media giant’s headsets are gaining traction among businesses and that Meta is moving to make its products more user-friendly.

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However, investors have grown impatient with the pace of progress and have started to question whether Meta’s investments in VR are a wise use of capital. The company lost $14 billion last year and is on track to lose $15 billion this year as sales of its VR headsets lag.

Meta’s latest effort to boost profitability is to monetize its messaging and features like Threads, its short video platform. It has invited a group of ad executives to a virtual roundtable next month to discuss ways for brands to run ads in the Metaverse.

In addition to e-commerce and advertising, Meta is betting on advances in artificial intelligence, which it calls its single most significant investment. Its ImageBind model, which was recently demonstrated at its Connect conference, is an early example of how AI might be used to create multisensory content that’s more immersive. It can combine text, visual, movement, thermal, and depth data to generate 3D models of real-world scenes that users in the Metaverse can explore.

This year’s Meta Connect, held September 27-28 in its headquarters in Menlo Park, California, will highlight the company’s progress in these areas. It’s also expected to showcase its new headset and a range of software and applications. But how far Meta is willing to take its vision of a future populated by digital avatars of humans will significantly impact the company’s prospects. Investors will be looking for details on how the company plans to prove that its technologies are a worthwhile investment. If not, it will be left behind by a growing list of competitors.