Extended Reality Market Size

Extended Reality Market Overview

Extended Reality (XR) Market Size was valued at USD 11.6 billion in 2021. The extended reality (XR) industry is projected to grow from USD 18.4 Billion in 2022 to USD 457.06 billion by 2030, exhibiting a compound annual growth rate (CAGR) of 58.2% during the forecast period (2024 - 2030).

The desire for extended reality (XR) to give workers the ability to effectively work remotely, join virtual meetings, and envision a live environment of their businesses are the key market drivers enhancing the market growth. In addition, the rise in people choosing online gaming as a career due to major advancements in internet connectivity and the accessibility of cutting-edge gaming equipment is fueling the market's expansion.

Figure 1: Extended Reality (XR) Market Size, 2022-2030 (USD Billion)

Source: MRFR Database, primary research, secondary research, and analyst review

Extended Reality (XR) Market Trends

The growing use of extended reality (XR) in the healthcare sector to boost the market growth

The use of extended reality (XR) in the healthcare industry creates new options for doctors and has promise for the future, particularly for contemporary healthcare institutions. Before beginning any medical operation, extended reality technology can assist surgeons in exploring the target organs by imagining the finer details of the patient's body to make it a risk-free process. For instance, in December 2022, Wolters Kluwer Health, a major  provider of information and point-of-care solutions for the healthcare industry, announced the integration of BioDigital XR with the Wolters Kluwer Medical Education and Medical Practice expansion. This collaboration will provide immersive, safe-to-fail environments with both virtual realities (VR) and augmented reality (AR) solutions to students throughout the healthcare landscape to enrich their learning curricula. Thus the rapid digitization of the medical sector has enhanced the extended reality (XR) market CAGR across the globe in recent years.

Extended reality technologies are becoming more common in both personal and professional settings. The introduction of 5G technology is intended to address these issues by paving the way for enhanced processing capability distribution. ly, the number of 5G users is expected to skyrocket from less than 200 million in 2019 to 1,02 billion by 2023. Countries such as China, South Korea, and the United States have already begun 5G operations in a few select places. Significant investments are being made worldwide to enable 5G installations in all regions. Therefore the rapid deployment and adaptation of 5G service is another factor driving the growth of the extended reality (XR) market revenue.

Figure 2: Estimated 5G users across the globe region wise from 2019 to 2027

Source: MRFR Database, primary research, secondary research, and analyst review

Extended Reality Market Segment Insights

Extended Reality (XR) Type Insights

The extended reality (XR) market segmentation, based on type, includes mobile XR and PC-tethered XR. The mobile XR sector dominated the market. The primary driver propelling the expansion of the mobile XR segment is the increasing adoption of XR technology in e-commerce and retail, entertainment, gaming, and several other industries.

February 2020: Qualcomm Technologies, Inc. has announced a new extended reality (XR) reference design headset based on the Qualcomm Snapdragon XR2 Platform, which the firm claims are the world's first 5G-enabled extended reality (XR) reference design with greater performance, immersion, and interactivity. This creation has further broadened the growth opportunity for the extended reality (XR) industry.

With positive sales growth in the gaming and entertainment sectors, tethered VR headsets were the fastest-growing sector. When opposed to solo headsets, tethered headsets offer a more immersive experience.

Extended Reality (XR) Components Insights

The extended reality (XR) market segmentation has been bifurcated by components into software, hardware, and services. In 2021, the hardware sector had the greatest revenue share. The hardware sector dominates the market thanks to the expanding use of extended reality (XR) devices across numerous industries and industrial verticals, including education, healthcare, construction, and retail.

Figure 3:  Extended Reality (XR) Market, by Component, 2021 & 2030 (USD Billion)

Source: MRFR Database, primary research, secondary research, and analyst review

The second fastest-growing segment in the extended reality (XR) industry is the software sector. Developers utilize the increased processing power made possible by the most recent hardware and software to create straightforward but comprehensive AR systems.

Extended Reality (XR) End User Insights

Based on End Users, the extended reality (XR) industry has been segmented into healthcare, media, industrial, manufacturing, retail and e-commerce, and transportation. With a major revenue share, the industrial & manufacturing sector led the market and is anticipated to hold this position throughout the forecast period. Utilizing extended reality (XR) technology enables leaders in a wide range of sectors and industry verticals to find any problems or hiccups, check that all processes are ongoing, and assist effective operations in minimizing manufacturing-related downtime. During the anticipated time, it is predicted that the healthcare segment will grow at the fastest rate. Treatment plans may be completed at home with technology ranging from four to twelve weeks. Hence, rising extended reality (XR) applications in the healthcare sector positively impact market growth.

Extended Reality (XR) Regional Insights

By Region, the study provides market insights into North America, Europe, Asia-Pacific and Rest of the World. Asia Pacific’s Extended Reality (XR) market accounted for USD 4.9 billion in 2021 and is expected to exhibit a significant CAGR of 42.9 percent growth during the study period. The region's continuous implementation of 5G high-speed networks is also anticipated to hasten the adoption of extended reality (XR) technology. By the end of 2022, India will have 31 million 5G customers, and by the end of 2028, there will be 690 million. Moreover, China extended reality (XR) market held the largest market share, and the India extended reality (XR) market was the fastest-growing market in the Asia-Pacific region.

Further, the leading countries studied in the market report are Canada, The U.S, France, Germany, Spain, UK, Italy, China, Japan, India, Australia, South Korea, and Brazil.

Figure 4:  EXTENDED REALITY (XR) MARKET SHARE BY REGION 2021 (%)

Source: MRFR Database, primary research, secondary research, and analyst review

North America’s extended reality (XR) market accounts for the second-largest market share. The extended reality market in North America is anticipated to expand greatly over the forecast year, largely due to numerous vendors who have made sizable investments in market innovations, including Qualcomm and Microsoft. By 2025, 328 million people are anticipated to be smartphone customers in the North American region, according to the GSMA. With the significant influence that smart devices, particularly smartphones, have on the advancement of extended reality (XR) technology, the area presents a large opportunity for the extended reality (XR) market under study throughout the projection period. Further, the US extended reality (XR) market held the largest market share, and the Canadian extended reality (XR) market was the fastest-growing market in the region.

Europe’s Extended Reality Market is expected to grow at the fastest CAGR from 2022 to 2030. The greater number of gamers in Europe contributes to the region's rapid uptake of cutting-edge XR gear. In the UK, there were approximately 46.7 million gamers as of 2021, with mobile phones being the most widely used gaming platform. Further, the German extended reality (XR) market held the largest market share, and the UK extended reality (XR) market was the fastest-growing market in the European region.

Extended Reality (XR) Key Market Players & Competitive Insights

Major market players are spending a lot of money on R&D to increase their product lines, which will help the extended reality market grow even more. Market participants are also taking various strategic initiatives to grow their worldwide footprint, with key market developments such as new product launches, contractual agreements, mergers and acquisitions, increased investments, and collaboration with other organizations. Competitors in the extended reality (XR) industry must offer cost-effective items to expand and survive in a growing competitive market environment.

One of the major business strategies manufacturers adopt in the extended reality (XR) industry to benefit clients and expand the market sector is manufacturing locally to reduce operating costs. In recent years, the extended reality (XR) industry has provided medicine with some of the most significant benefits. The extended reality (XR) market major players such as Agile lens, Tata Exlsi, Qualcomm incorporated, Augray, and others are working on expanding the market demand by investing in research and development activities.

Solotech is a technical equipment provider for festivals, television presentations, and corporate events. The company provides professional services that allow businesses, educational institutions, governments, hotels, and restaurants to obtain customized integrated AV and technological products for their events. In December 2021, Solotech purchased XR Studios, a full-service business specializing in augmented reality technologies for live broadcast and virtual projects. In accordance with the strategic plan, XR Studios will carry on as a distinct company and brand, maintaining its dominant market position.

Also, Immersivecast is a cloud VR-based technology and program developer that aims to give a completely immersive experience. The company develops photorealistic cloud extended reality (XR) applications combined with ultra-high-resolution VR glass and advanced human-machine interfaces, allowing gaming companies to reduce user latency. In November 2021, Immersivecast introduced the XR Metaverse Workspace, a service environment that enables multi-dimensional Web 3.0 by merging NFT, AR, and VR and accelerates content production.

Key Companies in the extended reality (XR) market include

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  Vree

  
  


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  Talespin

  
  


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  Qualcomm Incorporated

  
  


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  Tata Exlsi

  
  


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  Spheregen

  
  


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  HP reveal

  
  


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  Semcon

  
  


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  GO Find

  
  


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  Agile lens

  
  


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  Nothern digital

  
  


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  Medtronic

  
  


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  Augray

  
  

Extended Reality (XR) Industry Developments

• February 2024 - The South Korean company MediThinQ has developed a pair of XR-wearable displays which are targeted toward surgeons. Besides this, the firm also claims it has made a substantial investment, which it obtained from JLK Technology.


• February 2023 - Samsung Electronics Co. was able to announce the signing of a partnership with both Google and Qualcomm during the show which took part in San Francisco dubbed Galaxy Unpacked. The partnership in question is centered on the goal of advancing the market with an ecosystem.


• February 2023: The 5G-enabled OnePlus 11 is to be enhanced through collaboration with Qualcomm by incorporating the Snapdragon Spaces extended reality capability, with the goal of simplifying the process of developing an XR ecosystem for creators. Such collaboration aims to virtually place users in the center stage of films or live concerts and allow for a greater gaming experience.


• October 2022: Ericsson entered into a collaboration with the University of Texas (UT) Austin, expanding their research partnership with the intention to propel 6 G-powered XR technologies that will provide the user with realistic and smooth experiences.


• September 2022: Meta and Qualcomm signed an agreement to work on custom chips in order to create the next generation of extended reality systems for the Metaverse.


• Meta launched new Ray-Ban Meta Glasses in September 2024 with AI incorporations allowing the glasses to assist users in remembering specific locations, such as their picking spots. Additionally, the glasses offer real-time translation, capture movements, enable users to experience hands-free interaction with the world and much more.


• Microsoft understood the demand for Portable Virtual Reality headsets in the market and aimed to release it planned in August 2024. After signing the contract, a deal with Samsung Display to order micro-OLED panels for the headset was made. This headset aims towards the gaming and entertainment markets instead of the metaverse.


• In February 2023, the PlayStation VR2 was given brief information to the public. It was launched by Sony Group Corporation along with its Bluetooth controller accessory known as the PlayStation VR2 Sense, beginning a new dawn of interactive gaming experience. One of the key features of PS VR2 Sense is a head feedback system that has the ability to track the user's eye and adapt to the user's volume level.


• In March 2023, Meta made an announcement that it is targeting to release its very first AR glasses in the year 2027. These glasses are said to undergo in-house testing starting in the year 2024.

Extended Reality (XR) Outlook

• Customer engagement


• Business engagement

Extended Reality (XR) Type Outlook

• Mobile XR


• PC tethered XR

Extended Reality (XR) Component Outlook

• Software


• Hardware


• Services

Extended Reality (XR) End User Outlook

• Healthcare


• Media


• Industrial


• Manufacturing


• Retail and eCommerce


• Transportation

Extended Reality (XR) Regional Outlook

• North America
  
  
  
  • US
  
  
  • Canada
  
  
  
  


• Europe
  
  
  
  • Germany
  
  
  • France
  
  
  • UK
  
  
  • Italy
  
  
  • Spain
  
  
  • Rest of Europe
  
  
  
  


• Asia-Pacific
  
  
  
  • China
  
  
  • Japan
  
  
  • India
  
  
  • Australia
  
  
  • South Korea
  
  
  • Australia
  
  
  • Rest of Asia-Pacific
  
  
  
  


• Rest of the World
  
  
  
  • Middle East
  
  
  • Africa
  
  
  • Latin America