3 Surefire Metaverse stocks that could make you richer in 2022

The metaverse has created quite a buzz as businesses and investors scramble to claim a claim in this digital gold rush. Yet this conceptual reality remains largely in the ether, not yet grounded in reality. So what exactly is the Metaverse?

In simpler terms, the Metaverse combines a number of emerging technologies – including augmented reality (AR) and virtual reality (VR) – with elements of ubiquitous technology like social media and video, resulting in a digital world. immersive where users can work, play, shop and socialize. Bulls calls the metaverse the next evolution of the Internet, providing a network of permanent virtual spaces where people can interact.

Understandably, investors are looking for a way to take advantage of this rapidly changing landscape of what many believe is “the next big thing”. Let’s take a look at three successful businesses that will benefit from the vast opportunities of the coming metaverse.

Image source: Getty Images.

Nvidia: fueling the metaverse

No discussion of the Metaverse would be complete without the processing power to bring the idea to life, and that’s where Nvidia (NASDAQ: NVDA) Its graphics processing units (GPUs) are the undisputed industry standard for delivering lifelike images in video games, giving it a leg up in the metaverse.

The humble GPU has a superpower that will make it a foundational technology in the digital realm. Parallel processing allows GPUs to process a multitude of complex mathematical calculations simultaneously and at lightning-fast speeds.

This capability ushered in the era of artificial intelligence (AI), making Nvidia GPUs the workhorse of all major cloud computing operations and in a growing number of data centers. The evolution of the Metaverse will require similar speed and precision, making advanced semiconductors from Nvidia the obvious beneficiary.

Yet even though the Metaverse takes years to materialize, Nvidia continues to grow like wildfire. In the first nine months of this year, Nvidia’s revenue grew 65% year-on-year, leading to a 132% increase in earnings per share. Nvidia generated around $ 16.7 billion in revenue last year, but that’s a drop in the ocean compared to its total addressable market, which management estimates will exceed 250 billion. dollars by 2023.

The incredible potential offered by the metaverse is just the icing on the cake for long-term shareholders.

Adult wearing virtual reality headset, having fun on sofa with child.

Image source: Getty Images.

Unity Software: Creating the metaverse before our eyes

While it might not be a household name, Unity software (NYSE: U) is well known among the game and developer communities. The company provides a set of software tools that help developers create, run, and monetize real-time interactive 2D and 3D content for mobile phones, tablets, PCs, and consoles, as well as AR and VR devices. These tools will create the real-time charts underlying the metaverse.

Unity recently took these goals forward with the acquisition of certain assets from visual effects specialist Weta Digital, a brainchild of filmmaker Peter Jackson (The Lord of the Rings and The Hobbit trilogy). Weta Digital helped create the visuals for iconic content, including Avatar, The Avengers, Game of thrones, Planet of the Apes, Suicide Squad, Black Widow, and more. By adding Weta’s tools to its creative offerings, Unity is accelerating the advent of the metaverse.

But Unity Software doesn’t need the metaverse is a success, as evidenced by its third quarter results. The company generated revenue of $ 286 million, up 43% year-on-year. At the same time, Unity recorded a share loss of $ 0.41, cutting its red ink by more than half. Not only has the company exceeded expectations, it has also raised its outlook for the year as a whole. Unity now expects revenue of around $ 1.08 billion, up about 40% at the midpoint of its forecast.

Annual measurements help complete the picture. Games created on the Unity platform accounted for 71% of the top 1,000 mobile games in the fourth quarter of last year. Unity closed 2020 with 2.7 billion monthly active users, up 63% year-over-year. At the same time, apps built with Unity were downloaded 5 billion times per month, up 41%.

Whether the metaverse takes a year or a decade to come to life, Unity Software will thrive either way.

Person taking photos of a house using a tablet.

Image source: Getty Images.

Matterport: mapping physical spaces to create digital replicas

Matterport (NASDAQ: MTTR) is another business without name recognition, but it will be essential in this new age of the Internet. The spatial data company uses 3D cameras to capture and digitize real-world spaces, then creates dimensionally accurate and photorealistic virtual replicas. This process provides customers with the information they need to manage spaces more effectively. But this is only the beginning.

Matterport recently announced strategic partnerships with Cloud Titan Amazon and Meta-platforms‘Facebook AI Research (FAIR). Additionally, the company launched Matterport for Mobile, putting its 3D capture tools in the hands of anyone with a Google Android phone by. Alphabet or one Apple iPhone.

Its specialized offerings mean that Matterport is currently serving a niche market, but one that has the potential to grow exponentially. For the first nine months of this year, the company generated total revenue of $ 84 million, up 35% year-over-year. Subscription and license revenues grew even faster, up 54% to about $ 49 million.

It is important to note that Matterport has only been a public company since July, so it is still in its infancy. So his operating expenses have exceeded income so far this year and he continues to spend money. This is expected to subside over time as the company builds on its digital software aspirations.

Matterport uses a freemium model to attract paying customers. For the first nine months of this year, its total subscriber base of 439,000 more than doubled, increasing by 116%, massively expanding its potential customer base. At the same time, paid subscribers soared 35%. Additionally, its net dollar expansion rate was 114%, meaning existing customers spent 14% more than in the prior year period.

Management estimates Matterport’s total addressable market at $ 240 billion – and that’s before any potential contribution from the Metaverse. The company has also positioned itself for the digital world to come and its tools will likely play a key role in mapping the new digital world.

There are real opportunities in the virtual field

The Metaverse hasn’t made its way from the drawing board to reality yet, but many of the necessary components are already in place – and the opportunity is significant. Morgan Stanley analyst Brian Nowak estimates the Metaverse will be worth around $ 8 trillion, so there’s a lot of potential profit to be made.

The metaverse could propel each of these companies – already thriving in their own right – to new heights and help enrich investors in 2022 and for decades to come.

10 stocks we like better than Nvidia
When our award-winning team of analysts have stock advice, it can pay off to listen. After all, the newsletter they’ve been running for over a decade, Motley Fool Equity Advisor, has tripled the market. *

They just revealed what they think are the top ten stocks investors can buy right now … and Nvidia was not one of them! That’s right – they think these 10 stocks are even better buys.

See the 10 actions

* Returns of the portfolio advisor as of December 16, 2021

Suzanne Frey, an executive at Alphabet, is a member of the board of directors of The Motley Fool. Randi Zuckerberg, former director of market development and Facebook spokesperson and sister of Meta Platforms CEO Mark Zuckerberg, is a member of the board of directors of The Motley Fool. John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of the board of directors of The Motley Fool. Danny Vena owns Alphabet (A shares), Amazon, Apple, Meta Platforms, Inc. and Nvidia. The Motley Fool owns and recommends Alphabet (A-shares), Alphabet (C-shares), Amazon, Apple, Matterport, Inc., Meta Platforms, Inc., Nvidia, and Unity Software Inc. The Motley Fool recommends the following options: Long January Calls 2022 at $ 1,920 on Amazon, long calls at $ 120 in March 2023 on Apple, short calls at $ 1,940 in January 2022 on Amazon and short calls at $ 130 in March 2023 on Apple. The Motley Fool has a disclosure policy.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Comments are closed.