The XR Industry will ride out the COVID-19 storm

1 November, 2021

The Covid-19 pandemic has impacted all aspects of life, including the high-tech industry. Even though both the AR and VR industries are negatively affected, the XR industry will grow as a new role in “the new normal” (Strategic Analytics, 2020). This development is expected to be stronger and stronger in the long run.

According to the report on Short and Long Term Impacts of COVID-19 on the AR and VR Market (David, 2020), this market can reach $27 billion in 2025.

The bright future of the XR industry is also mentioned in another report from James Bourne (2020). The findings of the analyst firm forecast the XR industry from 2020 to 2025, some highlights are:

  • In 2025, annual revenues of XR hardware can reach $28 billion.
  • In 2025, total shipments of XR, including VR and AR headsets will surge six fold.
  • The development of 5G networks will make 2021 and 2022 the “slight comeback” years of smartphone-tethered VR headsets.
Total Global XR Revenues (AR&VR) (Graphic: Business Wire)

Some sources expressed concerns that the pandemic can have repercussions for the market, though.

“Covid-19 will have a significantly negative effect on the market for XR in 2020.” TechForge Media (2020).

“We anticipate both shipments and revenues declining by just over 20% y/o/y. We expect that the launch of smartphone-tethered AR headsets is likely to be pushed back to at least the very end of 2020, if not 2021, effectively delaying our earlier anticipated growth in a consumer market for dedicated AR devices by a year.” TechForge Media (2020).

Negative impacts of the pandemic on the economy (Photo: freepik)

If organizations can survive these tough and uncertain periods, they can expect a rosy future in sight. In addition, the new trends of remote work and cloud infrastructure will direct the AR/VR markets to rapid growth.

“We have raised our longer-term forecast for XR hardware as a result of new work and life patterns in the new normal,” said David MacQueen, director of the virtual and augmented reality service at Strategy Analytics.

David MacQueen claimed that “Work at home, training, education, and collaboration will all benefit from AR/VR.”

The XR market is volatile but promising. (photo: fatir29/Shutterstock 2018)

The report of CCS insight also maintained that the XR market was volatile but promising. In fact, the extended reality products witnessed a growth of 21% in 2019.

You can read the full Strategy Analytics report and other information at:

By Jess and Lou