News: Magic Leap Looking into Sale of the Company, Report Says

Magic Leap Looking into Sale of the Company, Report Says

The rumors have been circulating for months, but now there's a source attached to the notion that Magic Leap is looking to sell itself off after a rough couple of years following the launch of its Magic Leap 1 augmented reality device.

The first rumbling of trouble came back in 2018, when the device was finally revealed to the public, after much Apple-style secrecy and well-hyped promotion, only to be scorched by many tech reviewers who apparently expected more from the $2,295 device.

The next major warning sign came just months ago when Magic Leap signed over its patents to JPMorgan Chase as collateral.

Finally, the biggest sign of trouble came with the abrupt departure of the company's CFO, as well as John Gaeta, its senior vice president of creative strategy.

Such talk of a sell-off, after roughly $2 billion in investment dollars from the likes of Google, NTT Docomo, Saudi Arabia's Public Investment Fund, the Alibaba Group, JP Morgan Chase, and others, couldn't have come at a worse time.

Although the US and the world is currently gripped by a coronavirus pandemic and the US stock market is in a rolling state of shock, a large portion of the world's workforce has been forced to explore remote working options, which could have been a bonanza for Magic Leap's sales team. To that end, on Tuesday, the company's chief product officer, Omar Khan, appeared on Bloomberg TV promoting the benefits of remote working via the Magic Leap 1.

The word that Magic Leap is looking to sell itself off comes from "people familiar with the matter," according to Bloomberg news. Despite Magic Leap's lack of significant revenue and a flagship device with limited market penetration, the source believes that the company could fetch up to $10 billion in a sale scenario.

A Magic Leap spokesperson declined to comment when contacted about the story.

Cover image via Magic Leap

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