NEW YORK - Facebook has agreed to buy Oculus for $2 billion, betting that its virtual reality may be a new way for people to communicate, learn or be entertained.
Facebook Inc. said Tuesday that the deal includes $400 million in cash and 23.1 million shares worth about $1.6 billion. Oculus employees are also eligible for an additional $300 million if the company achieves certain targets.
Oculus makes the Oculus Rift, a virtual reality headset that's received a lot of attention from video game developers, though it's yet to be released. It says it has received more than 75,000 orders for development kits for the headset.
Facebook tends to make long-term bets on companies where short-term gains may not be immediately obvious. Last month, it made a $19 billion deal for messaging startup WhatsApp.
On Tuesday, Facebook said that while applications for virtual reality technology beyond gaming are "nascent," it plans to extend it to other uses. These include communications, media, entertainment and education. Virtual reality technology is "a strong candidate to emerge as the next social and communications platform," the company said.
"Oculus has the chance to create the most social platform ever, and change the way we work, play and communicate," said Facebook's founder and CEO, Mark Zuckerberg, in a statement.
Shares of Menlo Park, Calif.-based Facebook fell 71 cents to $64.18 in after-hours trading after closing up 79 cents at $64.89.