The news: The AR and VR headset market is rebounding, led by Meta’s success.

• Global headset shipments grew 18.1% YoY in Q1 2025, per the International Data Corporation’s (IDC) Augmented and Virtual Reality Headset Tracker.
• Meta held a 50.8% market share, up from 36.2% in Q1 2024, cementing its role as an industry leader but indicating the market could be reliant on a single player.

The future of VR: Growth in headset and wearable devices will be driven by mixed-reality (MR) and extended-reality (XR) products, not traditional VR.

• XR shipments are forecast to grow 291% to 8.6 million between 2025 and 2029, with interest from both consumers and enterprises.
• Shipments of MR headsets are expected to increase 361% to 15.2 million, up from 3.3 million, driven by gamers and content.
• AR remains niche, with shipments projected to reach just 475,000 by 2029.

New challengers: While Meta’s products—especially Ray-Ban Meta Smart Glasses—continue to dominate, players like XREAL, Viture, and TCL are growing. All three specialize in optical-see-through glasses, which let users see floating digital content while remaining aware of their surroundings.

In Q1, XREAL held 12.1% of the market, up 57.6% YoY. Viture’s share grew to 6.2% from 2%. These gains indicate that consumers are increasingly interested in lighter, more practical wearables, even if they’re less immersive than traditional VR headsets.

Meta’s glasses reboot: Meta isn’t sitting idle with its Ray-Ban partnership, though—it announced a new product developed with Oakley this week.

• The glasses, which can be preordered starting July 11, have double the battery life of Ray-Ban Meta glasses and can capture 3K video.
• At $399, versus Ray-Ban’s $299 base price, the new glasses could be an affordable upgrade for power users and professionals.

Our take: Brands should make content that’s adaptable to both headsets and smart glasses to accommodate changing consumer interests. Investing in glasses-centric content can target consumers, while MR activations could be ideal for enterprise use cases such as training employees.