Facebook to Buy Virtual Reality Firm Oculus for $2 Billion

Updated March 25, 2014 10:52 p.m. ET

Facebook Inc. FB -1.09 % made its second blockbuster acquisition of the year, agreeing Tuesday to acquire Oculus VR Inc., a 20-month-old maker of virtual-reality goggles, for $2 billion in cash and stock.

Like Facebook's $19 billion purchase last month of text-messaging service WhatsApp, the deal is part of the social-networking company's vast ambition to connect people across all kinds of devices and modes of communication.

The deal also highlights the intense competition among big technology companies for promising startups, even when those startups, like Oculus and WhatsApp, have little revenue.