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The global augmented reality market size is estimated to grow by USD 157.21 billion between 2022 and 2027, accelerating at a CAGR of 28.71%. Market growth is driven by heightened investments in AR technology, escalating demand across diverse application segments, and the surging uptake of AR-enabled smart glasses and AR gaming. However, challenges such as privacy apprehensions, financial constraints, and standardization issues must be addressed. Strategic navigation and innovative solutions are essential to unlocking the market's full potential.
The market shows accelerated growth during the forecast period.
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This report extensively covers market segmentation by application (enterprise, retail, media and entertainment, healthcare, and others), component (hardware and software), and geography (APAC, North America, Europe, Middle East and Africa, and South America). It also includes an in-depth analysis of drivers, trends, and challenges. Furthermore, the report includes historic market data from 2017 to 2021.
The AR industry share growth by the enterprise segment will be significant during the forecast period. AR apps improve operational processes and are used by different enterprises to check inventory and provide information on the available stock. These apps are used for remote assistance, training, data visualization, marketing, collaboration, inspection, and repairs across various business verticals. Many enterprises augment their work using AR; the technology as it helps them minimize errors and solve complex problems.
The enterprise segment showed a gradual increase in market share with USD 5.27 billion in 2017 and continued to grow by 2021.
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Enterprises use AR applications for remote assistance to save time and travel costs. For instance, Progress-Werk Oberkirch AG, a metal processing automotive supplier, uses Ubimax Frontline AR software to communicate with experts to receive real-time on-site assistance with the help of smart glasses. NASA, on the other hand, has introduced AR apps for Microsoft HoloLens AR headset to provide live training and instructions. Furthermore, our report provides a brief analysis of the historical and forecast market share and their segments along with the reasons for growth from 2017 to 2027.
The growth of this segment is primarily attributed to the increasing adoption of AR technology, which is driven by an increase in the global demand for the industry.
North America is projected to contribute 37% of market growth by 2027.
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Technavio’s analysts have elaborately explained the regional trends and drivers that shape the AR industry during the forecast period. In North America, especially the US, has played a significant role in the development of technologies that people use in their daily lives. The capabilities of AR technology have been recognized significantly in Canada as well. Moreover, developers, manufacturers, and consumers are keen on developing and using smart technologies such as the Internet of Things (IoT) and various advanced technologies, such as AR, MR, and Virtual Reality. AR is among the leading and fastest-growing technology. Several vendors, such as Alphabet, Facebook, and Microsoft, have established a strong presence in the US and are heavily investing in AR technology. These vendors have established a strong presence in the US and are expanding in AR technology. Such factors will drive the market growth in this region during the forecast period.
Comapanies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the AR industry
Atheerair - The company offers augmented reality solutions such as the AtheersFront Line Worker Platform that connects front-line teams to the assistance they need to perform their best work. Also, the company offers a smart glasses platform and AI-powered tools.
We also have detailed analyses of the market’s competitive landscape and offer information on 20 market companies, including :
Qualitative and quantitative analysis of vendors has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize vendors as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize vendors as dominant, leading, strong, tentative, and weak.
The Augmented Reality (AR) market is experiencing rapid growth, fueled by advancements in Virtual and Augmented Reality technology and supported by metaverse/report/metaverse-market-industry-analysis and 5G providers. AR finds applications across various sectors, including retail, media and entertainment, and education, enhancing customer experiences and learning outcomes. Engineers leverage AR for design and visualization, while startups and tech players drive innovation in the AR industry.
Developing and designing head-mounted display (HMDs) bridges automotive sectors and defense & aerospace industry. Originally for pilots, HMDs now enhance driver safety and navigation. This cross-industry innovation showcases the transformative power of technology, propelling advancements in both civilian transportation and military operations.
In the gaming sector and media industry, AR creates immersive experiences, while in education, institutions like Stanford University integrate AR for enhanced learning. Moreover, AR facilitates training, quality control, and safety management in operations, installation, and maintenance, driving efficiency and productivity. As spatial computing and computer vision technologies evolve, AR continues to redefine interactions and workflows across diverse industries. Our researchers studied the data for years, with 2022 as the base year and 2023 as the estimated year, and presented the key drivers, trends, and challenges for the market.
The increasing investments in AR technology are the key factor driving the global industry growth. AR is an emerging technology, and several major players and startups are investing heavily in AR technology-related innovations. The technology is expected to be used in social media platforms, mobile devices (for virtual conference calls), and automotive devices, as well as in the retail and healthcare industries. As AR is being used every day by millions of people, it requires the delivery of copious amounts of data and vast processing power to deliver the information in real time. Innovation in the automotive, defense & aerospace, and manufacturing sectors is propelled by advancements in virtual reality (VR) technologies. AR applications like virtual fitting rooms and interactive showrooms are reshaping the retail industry, enhancing customer engagement. From law enforcement to livestream technologies, AR finds diverse applications, offering immersive experiences and driving efficiency across industries. As VR technology continues to evolve, its impact on various sectors is profound and transformative.
Massive investments are required to store the vast amounts of data being generated on a daily basis and deliver significant results, for which various vendors are investing in AR technology and engaging in partnerships and acquisitions. Several apps, such as real-time text translators, filters on camera apps, social media applications, and interactive maps with exhaustive information, use AR technology. Such advanced technologies require heavy investments to enhance the consumer experience. Vendors, therefore, are investing in AR; these investments will drive the growth of the market during the forecast period.
The increasing integration of AR in mobile devices will fuel the global industry growth. Many smartphone vendors, such as Apple and Samsung, are integrating hardware and software to create an AR mobile platform. Several manufacturers of mobile devices, such as smartphones, phablets, and tablets, are using AR solutions to enhance the user experience and increase the value proposition of mobile devices. The market is expected to grow during the forecast period, owing to the increased popularity and penetration of AR technology in smartphones and tablets.
Vendors have produced applications for AR phones to build a mobile AR ecosystem. Consumers can enjoy the AR functionality on their mobile devices owing to basic computer vision and positional tracking. With the introduction of Google Tango, accurate motion tracking, depth perception, and area learning through a device have become possible. Samsung and Huawei are among the companies likely to drive the hardware-based mobile AR market for the broader Android ecosystem in the coming years. The launch of such applications and the integration of AR in mobile devices to enhance user experience will further propel the growth of the AR market during the forecast period.
Privacy concerns over AR technology are a major challenge to the global industry growth. AR collects and processes vast amounts of information about users and their environment. Privacy concerns, therefore, are a major challenge in the global AR market. AR technology can access the personal data of users and may pose a threat to their privacy. It can collect a lot of information from the user's social networking accounts. User privacy can also be threatened if hackers gain access to the user's device. Moreover, there are privacy-related concerns associated with AR smart glasses. These smart glasses automatically screen and process the user's environment, violating the privacy of the user and those around them.
The development of such products may hamper the growth of the AR market during the forecast period. Moreover, AR smart glasses are a major source of concerns about privacy, as they automatically screen and process a user's environment; therefore, the privacy of users and those around them can also be affected. Such issues may hamper the growth of the AR market during the forecast period.
Our analysis of the Life Cycle of the AR industry indicates a movement from the innovator’s stage to the laggard’s stage. Technavio has included key purchase criteria, adoption rates, adoption lifecycles, and drivers of price sensitivity to help companies evaluate and develop growth strategies from 2022 to 2027.
Market Customer Landscape
The market research report provides comprehensive data (region wise segment analysis), with forecasts and estimates in "USD Billion" for the period 2023 to 2027, as well as historical data from 2017 to 2021 for the following segments
The market is witnessing exponential growth wi th the proliferation of AR glasses and advanced augmented reality hardware. Industries such as automotive, defense & aerospace, and manufacturing are leveraging AR for designing staging and quality control processes. AR is revolutionizing augmented surgeries and professional training in the medical and engineering sectors, while the gaming industry adopts AR for immersive experiences through head-mounted displays. Retailers are embracing AR for interactive showrooms and virtual fitting rooms, enhancing the retail and e-commerce experience. Moreover, AR facilitates maintenance and remote assistance in various sectors and enables space visualization and virtual tours. With innovations like OLED technology and spatial computing, AR is poised to transform industries and everyday operations. The market is experiencing a profound transformation with the integration of cutting-edge technologies like 5G, enabling seamless connectivity and enhanced experiences.
AR chipsets are driving innovation in industries such as automotive, defense & aerospace, and industrial & manufacturing, revolutionizing design and visualization processes. From brand engagement to safety management, AR is reshaping operations across sectors like retail, law enforcement, and medical education, fostering brand engagement and wellbeing. The media industry is leveraging AR for immersive storytelling, while e-learning apps and training & upskilling platforms are enhancing educational experiences. With advancements in Mixed Reality (MR) and virtual walkthroughs, AR is poised to redefine interactions, driving engagement and innovation in diverse sectors worldwide.
Moreover, the market continues to thrive across various sectors, including automotive, defense & aerospace, education, and manufacturing industries. AR technology is reshaping the driving experience in the automotive sector and enhancing space visualization in aerospace. In the education industry, AR facilitates immersive learning experiences, while in the gaming sector, it elevates gaming experiences through head-mounted displays and interactive environments. Retailers utilize AR for virtual fitting rooms and interactive showrooms, enhancing the retail and e-commerce experience. Law enforcement agencies leverage AR for drug information and installation and assembly procedures. With applications ranging from virtual walkthroughs to home depot installations, AR technology is revolutionizing how we interact with the world, driving innovation and enhancing user experiences across diverse industries.
The convergence of Virtual and Augmented Reality (VR/AR) technology with 5G connectivity is revolutionizing various sectors. In the automotive industry, VR enhances design and prototyping, while AR aids in maintenance and training. The defense & aerospace sector utilizes VR for simulations and training purposes, enhancing operational efficiency. Retailers employ AR for immersive shopping experiences, integrating virtual fitting rooms and interactive showrooms. In the art & designing industry, VR enables artists to create and showcase their work in virtual environments. Additionally, VR finds applications in education at institutions like Stanford University, facilitating immersive learning experiences. As Tech players and manufacturers continue to innovate, VR/AR technologies are becoming increasingly accessible and impactful across various industries, reshaping the way we work, learn, and interact.
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Augmented Reality (AR) Market Scope |
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Report Coverage |
Details |
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Base year |
2022 |
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Historical year |
2017-2021 |
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Forecast period |
2023-2027 |
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Growth momentum & CAGR |
Accelerate at a CAGR of 28.71% |
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Market growth 2023-2027 |
USD 157.21 billion |
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Market structure |
Fragmented |
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YoY growth (%) |
31.54 |
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Regional analysis |
North America, APAC, Europe, South America, and the Middle East and Africa |
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Performing market contribution |
North America at 37% |
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Key consumer countries |
US, China, Japan, Germany, and UK |
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Competitive landscape |
Leading companies, Competitive Strategies, Consumer engagement scope |
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Key companies profiled |
Alphabet Inc., Atheer Inc, Dynabook Inc., Facebook Inc., Inglobe Technologies Srl, Marxent Labs LLC, Maxst Co. Ltd., Microsoft Corp., Optinvent, PTC Inc., Qualcomm Inc., RealWear Inc., Samsung Electronics Co. Ltd., Seiko Epson Corp., Sony Group Corp., Ultraleap Ltd., Upskill, Vuzix Corp., Wikitude GmbH, and Zugara Inc. |
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Market dynamics |
Parent market analysis, market growth and trends, market forecasting, market growth inducers and obstacles, fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, and market condition analysis for the market forecast period. |
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Customization purview |
If our market report has not included the data that you are looking for, you can reach out to ourmarket growth and trends analysts and get segments customized. |
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1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Application
7 Market Segmentation by Component
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
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