In 2023, the AR and VR industry generated revenue of USD 47.6 billion, the market is estimated to experience a CAGR of 23.7% over the forecast period, to attain USD 210.4 billion by the end of the decade. Such is mainly driven by the expeditious acceptance of these technologies that the gaming, entertainment, education, tourism, retail, and healthcare sectors are gaining.
AR and VR smart glasses, HUDs, and HMDs are conveniently wearable, i.e. they enable the user to freely move around and perform all daily activities while keeping the tech with them. For instance, AR displays are unlimited concerning their place of use because they do not interfere with visible reality. Even mobile VR headsets can be of great help by restraining movements in VE.
Advances are being made in the designs of these gadgets and they can be paired with smartphones or tablet computers. It is now possible to find AR and VR applications in various industries, as companies continue to test the boundaries of the integration of these technologies.
Extended reality (XR) systems are very soon going to become easily accessible through various channels to the masses. In this trend, the expanding traction of smartphones and tablet computers among consumers is wide enough for these technologies to position themselves. Global smartphone sales in many countries are booming, and these gadgets are treated as a very promising hardware platform for the AR and VR industry.
Key Insights
- During the projection period, AR technology is projected to grow at a CAGR of 23.9%, holding the largest industry share.
- In 2023, the hardware category had a 70% share, propelled by decreased device costs and gaming industry demand.
- HMDs dominated the AR device industry with more than 75% revenue share in 2023, projected to advance because of lightweight displays and technical improvements.
- HMDs also leading in the VR devices market with a 70% share in 2023, particularly in the gaming and tourism industries.
- Gesture-tracking devices to witness the fastest growth at a CAGR of 23.8% in the forecast period, expanding VR adoption in enterprises and education.
- In 2023, the Hardware category had a 70% industry share because of lower prices, gaming industry demand, and availability.
- The category is projected to produce higher revenue because of augmented demand for quality entertainment and emphasis on display enhancements and customization for enterprises.
- HMDs led AR devices with 75% revenue share in 2023, driven by lightweight displays and technology advancements.
- Demand for technology in tourism, automotive, gaming, and education fields is dramatically on the rise.
- VR headsets made up the biggest part of VR devices in 2023 with around 75% you could expect gaming and tourism to keep them in the lead in the years going forward.
- Virtual reality (VR) application to witness at 23.8% CAGR, flaring a sphere of usage in business and education.
- In 2023, consumers dominated the AR devices industry with 24.1% revenue, projected to advance particularly.
- The gaming category is the dominating and fastest-growing category in the VR devices industry.
- Key companies such as Oculus VR, Samsung, Sony, HTC, FOVE, Nintendo, and Electronic Arts.
- The APAC region is the fastest-growing industry at 24.2% CAGR, propelled by investments in commercial, defense, healthcare, and automotive industries.
- In 2023, the North American region had the largest industry share at 50%, propelled by huge government investments and the existence of top tech companies like Google, Microsoft, and Apple.
SOURCE: P&S Intelligence
