A look at how the AR/VR market made a comeback in Q1 2025
There is a notable shift away from bulky VR tech towards mixed and extended reality.
For all the hype around the metaverse, virtual and augmented reality headsets spent years bouncing between promise and pause. But the latest numbers suggest a turning point.
According to IDC, the global AR/VR headset market grew 18.1% year-over-year in the first quarter of 2025—a clear rebound after recent slowdowns. What’s more interesting than the growth itself is how the market is evolving.
Meta is still in command, holding a 50.8% share and growing its shipments by nearly 66%. But fast-moving challengers like XREAL and Viture are gaining ground with sleek, lightweight smart glasses that offer a very different kind of experience than traditional VR headsets. XREAL jumped to second place with a 57.6% increase in shipments, while Viture was the breakout story of the quarter, surging more than 268%. TCL also posted impressive gains at 91.6%.
Aside from competition, we're seeing a notable shift away from bulky VR tech towards mixed and extended reality. In fact, three of the top five companies this quarter (XREAL, Viture, and TCL) specializing in XR optical see-through glasses, together now account for over 22% of the market.
Meanwhile, the catch-all “Others” category shrank dramatically, down 47.2%, pointing to a market that’s consolidating around companies with focused strategies and forward-looking products.
Notably absent from the leaderboard were Sony and Apple, who have dominated past cycles but were sidelined this quarter by existing channel inventory and slower updates.
Looking ahead, IDC expects a major pivot from pure Virtual Reality to Mixed and Extended Reality. MR headsets, which blend digital overlays with real-world surroundings, are forecast to grow from 3.3 million units in 2025 to 15.2 million by 2029. ER, which includes devices like smart glasses for gaming and productivity, is projected to grow nearly fourfold in the same window. AR will grow more modestly but steadily.
Still, growth won’t be a straight line. IDC expects a dip in 2025 shipments—down 12%—due to delayed launches and new U.S. tariffs. But that’s expected to be temporary. A major rebound is forecast for 2026, with shipments up 87%, ultimately pushing the market past its pandemic-era peak. Long term, IDC projects a 38.6% compound annual growth rate through 2029.
What’s becoming clear is that AR/VR is growing out of its awkward phase. Pure VR isn’t the only game in town anymore. We’re moving beyond bulky goggles on your face into a space where immersive tech is actually practical and fits into everyday life.
