What Was The Growth Trajectory Of The AR/VR Chip Market In Recent Years?
The AR/VR Chip Market has seen a robust expansion in the past few years.
• The market size escalated from $3.96 billion in 2024 to $4.82 billion in 2025 at a compound annual growth rate (CAGR) of 21.9%.
The growth has been primarily driven by the proliferation of augmented reality (AR) and virtual reality (VR) applications, advances in graphics processing unit (GPU) technologies, and an upsurge in the gaming and entertainment industries. Healthcare and education sectors also witnessed increased adoption of AR/VR, while the demand for high-performance computing in AR/VR devices spurred market growth.
What Are The Projected Growth Rates And Market Size Of The AR/VR Chip Market By 2029?
The AR/VR chip market is anticipated to see remarkable growth in the coming years.
• It is expected to witness a surge to $10.1 billion in 2029, with a promising CAGR of 20.3%.
The forecasted growth can be attributed to the expansion of augmented reality glasses and headsets, and advancement of AR/VR in enterprise and industrial applications. Integration of 5g technology enhancing AR/VR experiences, increased demand for compact and power-efficient AR/VR chips, and growth in extended reality (XR) and mixed reality (MR) applications will fuel the market growth.
What Are The Factors Propelling The AR/VR Chip Market's Growth?
Increased adoption of mobile devices is projected to propel the AR/VR chip market in the future. Smartphones, having now practically replaced larger PCs due to advancement in data storage, computing, and display technology, are widely used for AR/VR game experiences, driving the overall AR/VR chip market growth. For instance, a report by G2.Com Inc. in January 2024 disclosed that Smartphones were used by 86% of the global population in 2023, with 90% of mobile time spent on apps in 2021. Such high adoption of mobile devices is therefore a primary driver for the AR/VR chip market.
How Is The AR/VR Chip Market Segmented?
The AR/VR chip market report segments the market into:
1) By Chip Type: Processor ICs, User Interface ICs, Power Management ICs
2) By Device Type: Head Mounted Display, Gesture Tracking Device, Projector and Display Wall, Head Up Display, Handheld Device
3) By End User: Gaming, Entertainment and Media, Aerospace and Defense, Healthcare, Other End Users
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What Are The Major Trends Shaping The AR/VR Chip Market?
Technological advancements are shaping the future of the AR/VR chip market. Major market players, like Qualcomm Technologies Inc., are launching advanced chips like Snapdragon XR2 Gen 2, designed for VR and mixed-reality devices, and the AR1 Gen 1, specifically developed for smart glasses. These chips offer a 2.5x boost in GPU performance and 8x better AI, enabling immersive mixed and virtual reality experiences.
Who Are The Key Players In The AR/VR Chip Market?
Major AR/VR chip market players include:
• Nvidia Corporation
• Imagination Technologies Limited
• MediaTek Inc
• Intel Corporation
• Spectra7 Microsystems Inc
• Advanced Microdevices Inc
• International Business Machine Corporation
• Samsung Electronics Co Ltd
• Huawei Technologies Co. ltd
• Broadcom Inc
Which Region Is Leading The AR/VR Chip Market?
Asia-Pacific had the largest share of the AR/VR chip market in 2024, followed by North America. The report also covers regions like Western Europe, Eastern Europe, South America, Middle East, and Africa.
