New Study Projects VR Revenue to Reach $20.3 Billion by 2027

ARtillery Intelligence publishes its five-year outlook for VR revenues.

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LOS ANGELES, September 21, 2023: ARtillery Intelligence today released a new report that projects VR revenue to grow from $9.04 billion in 2022 to $20.3 billion in 2027, a 17.6 percent compound annual growth rate. Entitled VR Global Revenue Forecast, 2022-2027, the report examines VR revenue totals and subsegments – including consumer and enterprise spending.

Consumer spending (hardware and software) holds a leading share of VR revenues with an estimated $5.82 billion in 2023. This is driven by gaming’s dominance as a VR use case but will broaden to other categories over time, including entertainment and communications. Enterprise spending trails slightly with $5.12 billion, led by immersive training, design collaboration, and other ROI-driven use cases.

VR Global Revenue Forecast: 2022-2027

In all cases, VR’s biggest accelerant is Meta’s ongoing investments. The flagship Quest 2 remains competitively priced at sub-$500 levels – a central piece in Meta’s longer-term strategy to jumpstart a network effect through loss-leader pricing. Meanwhile, sales have slowed in the first half of 2023 but they’re expected to rebound during the holiday quarter and into 2024.

“Quest 2 may be approaching market saturation relative to aggregate consumer VR demand,” said ARtillery Intelligence Chief Analyst Mike Boland. “But Quest 3 could accelerate a replacement cycle and represent Meta’s next VR inflection as specs are up-leveled across the board.”

But it’s not just about Meta. Other notable players include Valve Index in PC VR, PSVR 2 in console-based VR, and Pico 4 in standalone VR. The latter could challenge Meta with a competitive spec sheet and a similarly deep-pocketed social media owner, ByteDance. However, Meta is ultimately advantaged by Reality Labs investment levels and a richer content ecosystem.

“Meta continues to elevate content by motivating developers through a larger hardware base, as well as acquiring game studios outright,” said Boland. “The latter not only injects cash but incentivizes content creators to enter the market – and venture funding to fuel them– through validated exit potential. Put another way, as with most other media and tech, content is king.”

Report Availability

VR Global Revenue Forecast, 2022-2027 is available to ARtillery PRO subscribers, and more can be previewed here. This report follows ARtillery Intelligence’s separate examination of mobile AR and headworn AR spending (including Apple Vision Pro projections).

About ARtillery Intelligence

ARtillery Intelligence chronicles the evolution of spatial computing, otherwise known as AR and VR. Through writings and multimedia, it provides deep and analytical views into the industry’s biggest players, opportunities, and strategies. Products include the AR Insider publication and the ARtillery PRO research subscription. Research includes monthly narrative reports, market-sizing forecasts, consumer survey data, and multimedia, all housed in a robust intelligence vault. Learn more here.