Extended Reality (XR) Market Size

Extended Reality (XR) Market size was over USD 77.38 billion in 2024 and is anticipated to cross USD 3.27 trillion by 2037, growing at more than 33.4% CAGR during the forecast period i.e., between 2025-2037. In the year 2025, the industry size of extended reality is estimated at USD 98.06 billion.The growth of the market can be attributed to the growing demand for advanced technologies such as virtual reality (VR), augmented reality (AR), and mixed reality (MR). The number of VR users around the world has reached more than 170 million. Currently, 79% of Americans are familiar with virtual reality technology. As of 2019, 15 million AR and VR devices had been sold. Globally, the number of VR/AR devices shipped in 2023 is expected to increase to 67 million. As technology advances, more companies are investing in extended reality technology in order to keep up with the competition and capitalize on the growing demand for immersive experiences. This demand is being driven by the need for more engaging content, such as video games, educational materials, and other entertainment.

In addition to these, factors that are believed to fuel the extended reality market growth of extended reality include the growing demand for 3D visualization in various applications, the development of sophisticated hardware and software solutions, and the emergence of artificial intelligence and IoT devices. Currently, there are 15 billion Internet of Things devices, which is expected to grow by over threefold by 2030 to 26 billion. A total of USD 745 billion was spent on IoT in 2020. A trillion dollars are predicted to be spent on IoT globally by 2022. With the help of machine learning algorithms, AI and IoT devices are capable of collecting and analyzing data in real-time, enabling them to make decisions based on the data collected. This can help create more immersive experiences in extended reality applications, such as virtual reality and augmented reality.