VR headsets to shift 30 million units a year by 2027, vastly behind wearables

Analyst firm IDC has forecast strong growth for virtual reality headwear, but even stronger growth for more modest wearables, with the latter to vastly outsell the former for years to come.

But before shipments of VR kit grow, vendors have to deal with a horror 2023 in which the analysts last week found quantities of augmented reality and virtual reality (AR/VR) headsets dropped by 44.6 percent year-over-year during calendar Q2.

"Downward pressure from the global economy has curbed demand while the negative impact of a price hike on the popular Quest 2 headset combined with aging hardware from multiple vendors to further hobble growth in this market," the market researcher found.

Across all of 2023, IDC expects 8.5 million headsets will ship, not many more than vendors moved during 2017.

IDC expects 2024 to be a better year for head-mounted kit, with 46.8 percent year over year growth driven by new hardware from Meta and ByteDance, as well as by the debut of Apple's Vision Pro.

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By 2027, the market is expected to reach 30.3 million units globally.

That's a whole lot of headwear.

But it's also 350 million units fewer than the "earwear" sub-category of the wearables market, which IDC found already shifts 320 million a year and will grow to 380 million by 2027.

In the same year, IDC expects 211.4 million smartwatches to ship, plus 29.4 million smart wristbands.

Do the math: around 620 million wearables will ship in 2027, compared to 30 million VR/AR devices.

Clearly, VR will not have gone mainstream in 2027. Again. And despite Apple entering the market.

But IDC does see some new brands going mainstream in the wearables market.

"Most consumers think of popular brands like Apple, Samsung, and Fitbit when it comes to wearables, and they would be correct," said Ramon T Llamas, research director with IDC's Wearables team.

"But driving growth are numerous smaller companies that may not have the global aspirations as the market leaders, but instead focus on specific geographies such as China and India with fully featured devices that meet price expectations.

"Looking ahead, it isn't too hard to imagine some of these brands being mentioned in the same breath as the world's most popular ones, or to imagine moving into adjacent markets where pent-up demand has yet to be fully satisfied." ®