Slower growth in AR/VR headset shipments in 2023, but strong growth forecast through 2027, according to IDC

NEEDHAM, Mass., March 21, 2023 – After a weaker-than-expected 2022, International Data Corporation (IDC) has lowered its 2023 forecast for augmented and virtual reality (AR/VR) headsets. Worldwide shipments are now expected to reach 10.1 million units this year, according to International Data Corporation’s (IDC) Worldwide Quarterly Augmented and Virtual Reality Headset Tracker. Despite the revised outlook, total shipments of AR/VR headsets are expected to grow 14% in 2023 and accelerate during the forecast period 2023-2027 at a five-year compound annual growth rate (CAGR) of 32.6%.

“The difficult macroeconomic climate is largely responsible for this year’s lowered expectations, although it will not affect all vendors equally,” said Jitesh Ubrani, research manager, mobility and consumer device trackers at IDC. “Sony’s new PSVR2 and Apple’s foray into space will help drive additional volume, while new devices from Meta and Pico, expected towards the end of 2023, will bring VR in 2024 as Xiaomi, Oppo and TCL are expected to they will increase consumer awareness of this category over the next 6 to 18 months.”

Among the various form factors, standalone VR headsets will face challenges in 2023 due to their extreme popularity in 2020 and 2021, resulting in unfavorable year-to-year comparisons and dependence on Meta’s launch schedule. However, tethered VR as well as tethered AR glasses headsets will have a relatively easier growth path in 2022 due to the lack of volume.

“Consumer VR usage has dominated the AR/VR market, but growing consumer interest in AR is beginning to reshape this segment,” noted Ramon T. Llamas, research director of IDC’s Augmented and Virtual Reality research team. “In the past, commercial users have led the AR segment with training and field applications. But with the advent of lighter form factors, brighter displays, clearer sound, and a growing list of titles, early adopters have swung the pendulum the other way. Combined with the widespread popularity of games for VR headsets, consumer usage will lead in both segments even as the case for commercial usage grows.”

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International Data Corporation (IDC) is the world’s leading provider of market intelligence, consulting services and events for the information technology, telecommunications and consumer technology markets. With more than 1,300 analysts worldwide, IDC provides global, regional and local expertise on technology, IT benchmarking and sourcing, and industry opportunities and trends in over 110 countries. IDC’s analysis and insights help IT professionals, executives and the investment community make fact-based technology decisions and achieve their key business goals. Founded in 1964, IDC is a wholly owned subsidiary of International Data Group (IDG), the world’s leading technical media, data and marketing services company. To learn more about IDC, please visit Follow IDC on Twitter at @IDC and LinkedIn. Subscribe to the IDC blog for industry news and insights.

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