🧠 Food for thought

Implications, context, and why it matters.

VR slows as AR glasses gain ground

• Augmented reality (AR) glasses are growing as the virtual reality (VR) market shrinks. VR headset shipments fell 14% year over year in the first half of 2025 1.
• That drop lines up with rising interest in lighter devices people can wear through the day.
• Chinese brands have launched new models, yet China’s AR glasses market is still split among many players. No single product has passed 500,000 annual shipments 2.
• Meta holds 75.7% of the global AR glasses market. The top four Chinese manufacturers each have less than 5%, which keeps the category in its early stages despite fast growth 2.

AR growth puts pressure on optical parts

• More waveguide-based glasses are driving a valuable niche for parts. One estimate values the global AR optical waveguide market at US$456 million in 2024 3.
• Production still faces hard limits. Many suppliers keep yields below 70% for high-performance waveguides, while advanced designs can cost more than US$200 a unit 3.
• A new supply chain is taking shape to ease those limits. More than US$1.4 billion went into dedicated waveguide manufacturing capacity from 2023 to 2025 4.
• Suppliers are opening new plants. Its 2024 facility in Kulim Malaysia was built to industrialize and scale waveguide production for AR smart glasses, SCHOTT said 5.