Extended Reality (XR) Market in 2025: Platform Consolidation, AI Integration, and the Rise of Smart Glasses

Extended Reality (XR) is undergoing another phase of strategic evolution, marked by platform consolidation, the emergence of Artificial Intelligence (AI)-first smart glasses, and increased focus on cross-platform interoperability. This ABI Research analysis highlights how market leaders—Meta, Google, and Apple—are shaping the XR space through full-stack integration across hardware, software, content, and AI. The report also addresses forecast trends by device type, evaluates strategic moves by component vendors, and unpacks the critical role of ecosystem partnerships in enabling scalable XR deployments.

Market Overview

The XR device market is shifting toward smart glasses, with no-display models (also called AI glasses) gaining traction due to affordability and practical use cases. These devices remove the costly and design-limiting display component, opening up applications in navigation, audio assistance, and contextual AI interactions. Ray-Ban Meta glasses currently dominate this segment, though broader competition is expected from 2026 onward.

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Low-power demands in this category also foster innovation in energy-efficient chipsets and specialized sensor packages, drawing interest from silicon vendors. As these glasses increasingly serve as the entry point to broader XR ecosystems, major platforms will use them to upsell full XR portfolios—including display-equipped headsets, productivity software, and AI capabilities.

Smart Glasses as the Primary Battleground

Smart glasses have become the primary battleground for new user adoption in XR. AI-first smart glasses—especially no-display variants—are gaining popularity due to broader use case coverage and more accessible price points. These devices, often called AI glasses, avoid the cost and complexity of integrated displays, which remain the most difficult and expensive components in XR hardware.

Demand is increasing for low-power smart glasses with and without displays. This is opening up opportunities across multiple component segments, as platforms look to position smart glasses as a gateway into more comprehensive XR ecosystems. Major vendors are leveraging these devices as entry points to broader portfolios that include other XR hardware, software and services, and AI-enabled tools.

AI and Partnerships Drive Ecosystem Expansion

AI capabilities are central to XR platform strategies. Meta, Google, and Apple all incorporate AI to strengthen their XR offerings, though none operate in isolation. Despite their internal capabilities, partnerships and open-source initiatives remain vital, particularly in AI processing and application integration. Even the largest vendors build on collaborative infrastructure to support XR development and service delivery.

This ecosystem dynamic will require companies to stretch across more segments of the value chain. A robust partner network is essential for filling gaps, enhancing product breadth, and achieving scale—especially for smaller players seeking relevance in a platform-dominated environment.

Device Forecasts Reflect Strategic Shifts

XR device forecasts highlight the rapid ascent of no-display smart glasses, the continued strength of standalone Virtual Reality (VR), and the slow but steady growth of display-enabled Augmented Reality (AR) glasses. Ray-Ban Meta currently dominates the no-display AR market, though additional competitors are expected to emerge in the coming years.

Standalone VR headsets remain the largest XR device category, driven largely by consumer gaming. Enterprise use cases—such as data visualization and remote collaboration—are gaining ground as well. Display-enabled AR glasses, while promising, face barriers in cost, implementation complexity, and market adoption.

Device trends are heavily influenced by major vendor roadmaps, with Apple, Google, and Meta leading development. However, other Original Equipment Manufacturers (OEMs)—including Samsung, OPPO, TCL, and Pico—are increasingly involved as both competitors and ecosystem partners.

The “Big Three” Platform Approaches

Meta: A Full-Stack Leader

Meta holds a comprehensive XR portfolio that spans hardware, software, Operating System (OS), and AI. Its Quest VR headsets and Ray-Ban smart glasses reflect a maturing product line, while Horizon OS extends platform reach to OEM partners. Notably, Meta supports open-source solutions throughout its ecosystem. Although Apple and Google pose growing competition, Meta remains the most fully realized XR platform, with clear momentum across segments.

Apple: Specialized but Fragmented

Apple’s XR presence is anchored by the Vision Pro—a high-end VR headset focused on enterprise use. While not intended for mass market adoption, the Vision Pro showcases Apple’s integration of XR into its broader ecosystem, including custom silicon and proprietary development tools. However, Apple currently lacks a confirmed roadmap for future XR devices, creating uncertainty among developers.

Google: Developer-Driven Platform Play

Google’s strength lies in its extensive Android developer base. Android XR, launched with Samsung’s Project Moohan, offers a tailored OS, AI integration, and familiar development tools. Content remains a central focus, with Google emphasizing XR-specific enhancements to existing Android workflows. Gemini, Google’s AI platform, is integrated throughout Android XR, showcasing multi-modal capabilities and real-time features.

Chipset Competition and Component Innovation

Component-level innovation is critical to XR growth, especially in displays and chipsets. Qualcomm remains the incumbent, offering dedicated XR chipsets adapted from smartphone technologies. Snapdragon Spaces, now part of Android XR, highlights Qualcomm’s alignment with ecosystem demands.

MediaTek is challenging Qualcomm’s dominance through custom silicon partnerships, including work with Meta on the Orion AR headset. MediaTek offers greater vendor flexibility and is capitalizing on demand for chipset alternatives.

HiSilicon, though less active globally, is positioned to grow within China. It offers dedicated XR silicon and could benefit from domestic preferences for local components.

Key Companies Covered

• Meta
• Apple
• Google
• Qualcomm
• MediaTek
• HiSilicon
• Unity
• DigiLens

Get the full report

Download the full ABI Research report, XR Platforms: OEMs, Developers, and Partners, to gain comprehensive insights into the future of Extended Reality (XR). Learn how major vendors are adapting their strategies, which technologies are driving adoption, and where emerging players can compete within an evolving XR ecosystem.