Global AR/VR Headset Market Grows By 45 Percent In Q1 of 2021

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HTC and Sony rounded out the top 5 VR headset companies

Global shipments of augmented reality (AR) and virtual reality (VR) headsets saw a year over year increase of 45 per cent in the first quarter of 2021 as compared to the same period last year, according to a new report. 

However, supply was constrained during the quarter. The global semiconductor shortage, in particular display driver ICs, led to a significant slowdown from the fourth quarter of last year.

In its recent report, IDC said that Facebook’s VR headset Quest 2 saw the highest growth of  207.4 percent year-over-year, adding that its immense popularity is due to the lower price point and the need to socialize during the pandemic.

Standalone headsets, which feature an all-encompassing design such as the Oculus Quest 2 or the HTC Vive Focus, accounted for the vast majority of shipments, capturing 82.7 per cent share during the quarter, up from 50.5 per cent in the first quarter of 2020.

The growing popularity of gaming, as well as fitness, has helped spread consumer awareness of VR while companies like Facebook have made the tech more accessible, the IDC said in a statement.

In addition to Oculus, Chinese companies DPVR and Pico also performed well during the quarter, finishing as the second and third ranked companies and growing 108.6 per cent and 44.7 per cent (YoY), respectively.

HTC and Sony rounded out the top 5 VR headset companies. 

AR headset shipments declined 17.2 percent this quarter as top products like Microsoft’s Hololens 2 now have greater availability and the year-over-year comparisons are tough since there was plenty of pent up demand for the Hololens 2 in 2020Q1, said IDC. 

As the global crisis of chip shortages continues to slow down production for companies, IDC forecasts VR headset shipments to grow at a limited pace of 28.9 percent YoY in 2021.

However, the long-term outlook remains quite strong as global shipments grow to 28.6 million in 2025 with a 41.4 percent compound annual growth rate (CAGR). 

“As companies continue to plan for a future that encompasses a combination of both in-person and remote work, we see VR playing an increasingly important role in driving next-generation collaboration, training, and digital events,” said Tom Mainelli, group vice president, Device and Consumer Research at IDC.

Meanwhile, AR headset shipments are expected to grow 45.6 percent in 2021 with a CAGR of 138 percent by 2025.

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