The entry of Alibaba and Li Auto has intensified the "Battle of 100 AI Glasses." At the end of November, Alibaba officially launched six models under its Quark AI Glasses S1 and G1 series, which quickly topped sales charts on JD.com, Taobao, and Douyin, selling over 7,000 units within two days. Shortly after, Li Auto announced the launch of its AI glasses, Livis, marking the company's first standalone AI hardware product and the starting point for its wearable devices.

The AI glasses market was already bustling before these developments. Over 40 new products were released domestically this year, with total shipments expected to reach 900,000 units. Tech giants like Huawei, Xiaomi, Baidu, and Alibaba have entered the fray, while startups such as Rokid, RayNeo, and INMO have rolled out multiple new models. Dubbed the "Battle of 100 AI Glasses," this competition involves tech titans, automakers, and startups, with products ranging from AI audio glasses to AR immersive glasses—all vying to dominate the next-generation personal computing platform.

Funding activity is equally fervent. Incomplete statistics show that, as of December, global financing in the AI glasses supply chain has exceeded RMB 10 billion, with over 30 funding rounds totaling nearly RMB 4 billion in China alone.

**Funding Shifts Upstream** Compared to last year, 2024 has seen a clear shift in funding trends. While brands were the primary investment targets in 2023, this year, capital is flowing toward upstream core technologies—particularly MicroLED and optical waveguide component manufacturers.

So far, only one company—Shanghai JBD Display Technology—has publicly announced funding exceeding RMB 1 billion, setting a global record for single-round financing in MicroLED micro-displays. The round was led by Chaos Investment and CITIC Securities, with participation from Lightspeed China Partners, GP Capital, and other institutional investors. Meanwhile, Hillhouse Capital and Sequoia Capital quietly invested in another MicroLED firm, Xingyao Semiconductor, which completed its business registration update in December.

In the optical display module sector, funding is also pouring in. Zhejiang-based Toppan Photomasks secured two rounds of financing exceeding RMB 100 million within six months, backed by Xiaomi, OPPO, and SMIC Capital. Another key player, LiPai Optoelectronics, completed a new funding round in November led by listed company Biyi Group.

A hard-tech investor noted that the AI glasses supply chain remains immature, with few companies capable of stable, customized production. "Meta’s smart glasses are the only product to hit one million sales so far. Its success validated the market, and now major players are jumping in, believing the industry is on the verge of a breakout. But compared to betting on individual brands, upstream component suppliers offer more certain opportunities."

Companies securing significant funding are scaling up production. Xingyao Semiconductor launched China’s first 8-inch silicon-based gallium nitride MicroLED pilot line in September, with an annual capacity of 12,000 chips. Toppan Photomasks has built the country’s first automated diffractive waveguide production line, capable of producing 100,000 units monthly. JBD Display, a leading supplier, has its MicroLED displays integrated into nearly 50 smart glasses models, including Rokid Glasses, Alibaba’s Quark AI Glasses, and RayNeo X3 Pro, while also securing orders from international tech giants.

**Terminals Await a "Hit Product"** Among terminal manufacturers, RayNeo stands out. In early November, it announced a Series C round led by CITIC Securities, rumored to approach RMB 1 billion—the largest single AR funding round in China this year.

However, most AI glasses brands have secured funding in the range of hundreds of millions. Of the "Four AI Glasses Startups" (RayNeo, XREAL, Rokid, and INMO), XREAL received RMB 200 million from Pudong Venture Capital in May, while INMO raised over RMB 150 million across two rounds. Rokid has not announced new funding this year. Other startups like Lightin Tech, LLVision, and Gyges Labs have also secured financing, ranging from tens to hundreds of millions.

Despite the hype, AI glasses remain a niche product, with leading domestic brands selling between 100,000 to 300,000 units annually—none surpassing 500,000. "Meta’s success was partly due to overseas market conditions. Whether China can replicate that is uncertain. The market needs a true hit product," emphasized an investor.

INMO CEO Yang Longsheng echoed this sentiment, noting that one million sales is a critical milestone for consumer electronics. INMO expects to reach this target in two to three years, with current annual shipments around 100,000. The entry of giants like Xiaomi, Huawei, Alibaba, and Baidu could accelerate this process.

An AI glasses engineer from a major tech firm revealed that their approach integrates AI glasses into broader product ecosystems, leveraging existing consumer electronics expertise. These companies also excel at consumer education.

The investor added that with major players entering, industry attention has grown fivefold this year. Even if they capture most of the market, the remaining opportunities still benefit startups.