Enterprise AR hardware and software are projected to grow from $314 million in 2016 to $35 billion in 2021. This is according to the latest data from ARtillry Intelligence, and takes the place of enterprise AR figures previously released.

One big takeaway is 2019’s inflection point. As often happens in tech revolutions, demand builds while organizational resistance — currently its biggest barrier — recedes. We saw this with enterprise smartphone adoption, and AR is on a similar path to ubiquity in some verticals.

When that tipping point comes — we believe in ’19 — market size will be significant. Meanwhile, enterprise adoption has been slow. Though there are clear ROI gains in functions like assembly and maintenance, organizational inertia is a powerful counterbalance that will take time to recede.

As for the revenue breakdown, hardware will dominate in early years, as an installed base is established (as is often the first step for new tech). That hardware base will pave the way for enterprise software, which will slowly gain share of overall enterprise AR revenues in outer years.

That software share is one of the sector’s long-term revenue drivers. As seen in historical comps such as enterprise Saas, it can have highly scalable and recurring revenue. This, plus enterprise AR’s wide applicability in enterprise functions, makes its market size huge. The question is when.

Simplified view: year by year detail provided in the full report

As for the data refresh, like many analyst firms, ARtillry Intelligence performs bi-annual forecast rounds. And in embryonic sectors, it sometimes compels mid-cycle updates. Now that 2017 is over and the full-year sales numbers are coming in, they compelled an update to previous figures.

Enterprise XR, including a deeper dive on these figures, is also the topic of the next ARtillry Intelligence Briefing which will be available to subscribers this week, and previewed here next week. Meanwhile, more about our market sizing methodology can be seen here. Stay tuned.

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Disclosure: ARtillry has no financial stake in the companies mentioned in this post, nor received payment for its production. Disclosure and ethics policy can be seen here.