The augmented reality and virtual reality market size is projected to reach US$ 646.50 billion by 2031 from US$ 52.40 billion in 2023. The market is expected to register a CAGR of 36.9% during 2023–2031. 5G integration and mixed reality are likely to remain key trends in the market.

Augmented Reality and Virtual Reality Market Analysis

AR and VR technology provide numerous unique opportunities for both new and established enterprises and commerce. AR technology allows people in numerous professions to see computer-generated graphics in their field of view. Both technologies are widely used in several industries, including healthcare, media, gas and oil, tourism, education, gaming, entertainment, military, marketing, e-commerce, and retail.

Augmented Reality and Virtual Reality Market Overview

The global AR and VR industry is experiencing rapid expansion due to increased demand for mobile devices and R&D investments. AR/VR technology has poor demand and adoption compared to other consumer devices because of its high cost and visual impact. Leading multinational tech corporations are investing in VR/AR research and development to advance the technology.

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Augmented Reality and Virtual Reality Market: Strategic Insights

Augmented Reality and Virtual Reality Market

• 
  CAGR (2023 - 2031)

  36.9%
• Market Size 2023
  US$ 52.40 Billion
• Market Size 2031
  US$ 646.50 Billion

Market Dynamics

GROWTH DRIVERS

• The rising applications in the automotive sector, rising healthcare applications

FUTURE TRENDS

• 5G integration, mixed reality

OPPORTUNITIES

• Rising Adoption in the Entertainment Sector

Key Players

• Immersive Gaze
• Google LLC
• EON Reality
• Vuzix Corporation
• Blippar Group Limited (Layar B V)
• Innovega Inc.
• imulanis Solutions Private Limited
• Kanda ApS
• YeppAR
• Groove Jones

Regional Overview

• North America
• Europe
• Asia-Pacific
• South and Central America
• Middle East and Africa

Market Segmentation

Component

• Solution
• Services

Technology

• Augmented Reality
• Virtual Reality

Component

• Semiconductor Components
• Sensors

End-User Industry

• Entertainment
• Educational
• Industrial
• Medical
• Real Estate & Architecture
• Retail
• Aerospace & Defense

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Augmented Reality and Virtual Reality Market Drivers and Opportunities

The Rising Applications in the Automotive Sector to Favor the Market

AR/VR in the automobile industry is increasingly becoming a standard due to the numerous applications and benefits it provides. It simplifies and improves the vehicle purchase and driving experience for all parties concerned. The automobile industry is aggressively adopting AR/VR to improve driving and vacation experiences. In fact, among all the major sectors, the automotive sector invested the most in AR and VR technologies.  Some industry heavyweights, like Porsche, Chrysler, Hyundai, Mitsubishi, and Tesla, have already integrated the two technologies into various stages of vehicle production, marketing, and sales. This is driving the demand in the augmented reality and virtual reality market.

Rising Adoption in the Entertainment Sector

The virtual reality entertainment sector has had a significant impact on how consumers consume media, causing a paradigm change in everything from video games to films, live shows, and amusement park experiences. VR/AR (Virtual Reality/Augmented Reality) technology is already beginning to have an impact on broadcasting and streaming media. VR/AR broadcasting and streaming may provide viewers with a fully immersive experience, allowing them to interact with material in new and intriguing ways. This technology may be utilized to produce captivating experiences such as 360-degree films, interactive sports coverage, virtual reality music events, and much more.

Augmented Reality and Virtual Reality Market Report Segmentation Analysis

Key segments that contributed to the derivation of the augmented reality and virtual reality market analysis are technology, component, and end-user Industry.

• Based on technology, the augmented reality and virtual reality market is divided into augmented reality and virtual reality. The augmented reality segment held a larger market share in 2023.
• By component, the market is segmented into direct semiconductor components, sensors, and others.
• By end-user industry, the market is segmented into entertainment, educational, industrial, medical, real estate & architecture, retail, aerospace & defense, and others.

Augmented Reality and Virtual Reality Market Share Analysis by Geography

The geographic scope of the augmented reality and virtual reality market report is mainly divided into five regions: North America, Asia Pacific, Europe, Middle East & Africa, and South & Central America.

North America dominated the augmented reality and virtual reality market share in 2023. The region has countries such as the US and Canada, which are technologically advanced. The startup landscape in the US is continuously evolving, with emerging players getting breakthroughs in state-of-the-art AR and VR technologies.

Augmented Reality and Virtual Reality Market Report Scope

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Augmented Reality and Virtual Reality Market News and Recent Developments

The augmented reality and virtual reality market is evaluated by gathering qualitative and quantitative data post primary and secondary research, which includes important corporate publications, association data, and databases. A few of the developments in the augmented reality and virtual reality market are listed below:

• EON Reality proudly announces the launch of the inaugural Spatial AI Center in the Marshall Islands. This pivotal initiative is set to transform the islands’ approach to education, healthcare, and climate resilience, deploying immersive technologies to pioneer advanced learning experiences and sustainable development. (Source: EON Reality, Press Release, April 2024)
• Vuzix® Corporation (NASDAQ: VUZI) announced it has received new additional orders from two aerospace and defense firms to further develop and deliver waveguide-based display solutions in 2024. (Source: Vuzix Corporation, Press Release, April 2024)

Augmented Reality and Virtual Reality Market Report Coverage and Deliverables

The “Augmented Reality and Virtual Reality Market Size and Forecast (2021–2031)” report provides a detailed analysis of the market covering below areas:

• Augmented reality and virtual reality market size and forecast at global, regional, and country levels for all the key market segments covered under the scope
• Augmented reality and virtual reality market trends as well as market dynamics such as drivers, restraints, and key opportunities
• Detailed PEST/Porter’s Five Forces and SWOT analysis
• Augmented reality and virtual reality market analysis covering key market trends, global and regional framework, major players, regulations, and recent market developments
• Industry landscape and competition analysis covering market concentration, heat map analysis, prominent players, and recent developments for the augmented reality and virtual reality market
• Detailed company profiles