AI in Virtual Reality and Augmented Reality Global Market Report 2024

The AI in virtual reality and augmented reality market size has grown exponentially in recent years. It will grow from $39.2 billion in 2023 to $57.37 billion in 2024 at a compound annual growth rate (CAGR) of 46.3%. The expansion observed in the historic period can be attributed to several key factors, including advancements in computer vision technologies, the development of more sophisticated machine learning algorithms, enhancements in natural language processing (NLP) capabilities, the proliferation of cloud computing infrastructure, and the emergence of edge computing solutions.

The AI in virtual reality and augmented reality market size is expected to see exponential growth in the next few years. It will grow to $264.7 billion in 2028 at a compound annual growth rate (CAGR) of 46.5%. The projected growth in the forecast period can be attributed to several key factors, including the advancement of AI-powered social interactions, the delivery of personalized content recommendations, the refinement of gesture and voice recognition capabilities, the creation of AI-generated realistic environments, and the expansion of healthcare and therapeutic applications leveraging AI technologies. These elements are expected to drive innovation and adoption, enhancing user experiences and opening up new possibilities in virtual reality (VR) and augmented reality (AR) domains. Furthermore, major trends anticipated in the forecast period include the integration of AI-driven virtual assistants within VR or AR environments, the enhancement of virtual try-on experiences through AI algorithms, the augmentation of object recognition and interaction using AI, the integration of AI with AR smart glasses for improved functionality, and the utilization of AI-powered immersive storytelling techniques.

The proliferation of IoT (Internet of Things) devices is poised to drive the expansion of AI in the virtual reality and augmented reality (VR/AR) market in the foreseeable future. IoT devices are physical gadgets equipped with sensors, software, and connectivity functionalities that enable them to gather and exchange data with other devices or systems over the Internet, forming a comprehensive IoT ecosystem. The interconnected nature of IoT devices facilitates seamless communication and data exchange, making them pivotal components in various industries. AI integration into VR/AR technologies enhances the capabilities of IoT devices by delivering immersive and intuitive user experiences, optimizing data analysis, enabling predictive maintenance, facilitating context-aware interactions, supporting remote monitoring and control functionalities, and enhancing training and simulation capabilities. For example, a report by the GSM Association in March 2023 projected a significant growth in IoT connections, more than doubling from 2021 to 2030 to reach a total of 37.4 billion connections. This surge in IoT device adoption directly fuels the growth of AI applications in the virtual and augmented reality sectors, creating opportunities for advanced functionalities and enhanced user experiences.

Leading companies in the AI-driven VR/AR market are actively developing innovative products like assisted reality glasses to cater to evolving consumer needs and preferences. Assisted reality glasses, also known as smart glasses, are wearable devices that overlay digital information, graphics, or visuals onto the user's field of view, enriching their perception of the physical world. For instance, Oppo, a China-based consumer electronics company, introduced the OPPO Air Glass 3 in February 2024. These glasses feature a full-color display within the lenses, providing real-time information to users. Powered by Oppo's large language model (LLM) called AndesGPT, the Air Glass 3 includes a voice assistant for hands-free interaction. These glasses are designed for daily use, allowing users to view digital content seamlessly integrated with their surroundings, such as messages or navigational cues.

In June 2022, The Glimpse Group Inc., a US-based software company, acquired PulpoAR, a software-as-a-service (SaaS) company specializing in virtual try-on technology for beauty brands using AR and AI. This acquisition strengthened The Glimpse Group's AI and image recognition capabilities, expanded its technology portfolio, and bolstered its competitive advantage in developing AR and VR applications across its subsidiary companies.

Major companies operating in the AI in virtual reality and augmented reality market are Apple Inc., Alphabet Inc., Samsung Electronics Co. Ltd., Microsoft Corporation, Meta Platforms Inc., Sony Corporation, Lenovo Group Limited, Intel Corporation, Qualcomm Incorporated, NVIDIA Corporation, Dassault Systemes SE, PTC Inc., Sixense Enterprises Inc., Magic Leap Inc., HTC Corporation, EON Reality Inc., Daqri LLC, Zappar Ltd., Scope AR, Vuzix Corporation, Upskill, Avegant Corporation, Atheer Inc., Cognixion, Marxent Labs LLC.

North America was the largest region in the AI in virtual reality and augmented reality market in 2023. The regions covered in the AI in virtual reality and augmented reality market report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, Africa. The countries covered in the AI in virtual reality and augmented reality market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Russia, South Korea, UK, USA, Canada, Italy, Spain.

AI in virtual reality (VR) and augmented reality (AR) entails the incorporation of artificial intelligence techniques and algorithms within VR and AR systems to enrich user experiences, enable intelligent interactions, and generate dynamic virtual content in real-time. By leveraging AI and immersive technologies, the goal is to create more lifelike, personalized, and interactive VR and AR environments across diverse applications.

The primary types of AI in virtual reality and augmented reality include AI-powered VR and AI-enhanced AR. AI-powered VR refers to VR experiences that are enhanced and personalized through the integration of AI algorithms. These experiences encompass various technologies such as natural language processing (NLP), computer vision, machine learning, deep learning, gesture recognition, speech recognition, and simulated environments. These AI technologies are deployed across a range of platforms including mobile devices, head-mounted displays (HMDs), projectors, smart glasses, wearables, body tracking devices, desktop computers, and consoles. They find applications in gaming and entertainment, education and training, healthcare and medical, retail and e-commerce, real estate and architecture, automotive and transportation, tourism and travel, social media and communication, industrial and manufacturing, as well as military and defense sectors. Through the integration of AI, VR, and AR, industries aim to revolutionize user experiences and unlock new possibilities in immersive technology across various domains.

The AI in virtual reality and augmented reality market research report is one of a series of new reports that provides AI in virtual reality and augmented reality market statistics, including AI in virtual reality and augmented reality industry global market size, regional shares, competitors with an AI in virtual reality and augmented reality market share, detailed AI in virtual reality and augmented reality market segments, market trends and opportunities, and any further data you may need to thrive in the AI in virtual reality and augmented reality industry. This AI in virtual reality and augmented reality market research report delivers a complete perspective of everything you need, with an in-depth analysis of the current and future scenario of the industry.

The AI in virtual reality and augmented reality market consists of revenues earned by entities by providing services such as consulting and development, training services, content creation, integration and customization, and designing services. The market value includes the value of related goods sold by the service provider or included within the service offering. The AI in virtual reality and augmented reality market also includes sales of head-mounted displays, sensors, cameras, processors, and input devices. Values in this market are ‘factory gate’ values, that is the value of goods sold by the manufacturers or creators of the goods, whether to other entities (including downstream manufacturers, wholesalers, distributors and retailers) or directly to end customers. The value of goods in this market includes related services sold by the creators of the goods.

The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD, unless otherwise specified).

The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.


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