According to CINNO Research, China's consumer XR market is expected to achieve structural growth by 2025, driven by breakthroughs in domestic supply chains and the profound reshaping of usage scenarios. Data indicates that total sales of consumer XR devices in China will reach 645,000 units in 2025, a 13% year-on-year increase, with AR devices selling 480,000 units and surpassing VR for the first time. By 2026, the market will exhibit a dual nature: while technology matures and costs decline, rising memory prices will put pressure on high-end VR devices. It is projected that China's consumer XR market will grow by 15% in 2026, and by 2030, AR consumer device shipments are expected to exceed 5 million units, dominating the terminal market.
1. Reshaping of the Domestic Consumer Market: AR Emerges as a Breakthrough, VR Focuses on Professional Scenarios AR devices have achieved a historic breakthrough: Benefiting from domestic upstream supply chain support and increased investment in the AR sector, consumer AR terminal sales in China reached 484,000 units in 2025, a significant 71% year-on-year growth. By 2030, consumer AR shipments are projected to surpass 5 million units, securing a dominant position in the terminal market. With continuous performance upgrades, AR devices are evolving from auxiliary tools to core interactive platforms. Some products now weigh nearly as much as regular eyeglasses, while display brightness and resolution have seen leapfrog improvements, ensuring clear visibility even in bright outdoor environments. AR devices are also rapidly penetrating sectors such as education, healthcare, and industrial design, with further expansion into more specialized fields expected by 2026.
VR market continues to shrink: China's consumer VR market experienced a seasonal downturn in 2025, with annual sales hitting a record low of 161,000 units. Leading brands significantly slowed their pace of new product releases, facing challenges such as waning consumer enthusiasm and limited application scenarios. Despite technological advancements that pushed beyond traditional entertainment boundaries—such as immersive offline experience centers—efforts to reposition VR from a "gaming-only device" to a "versatile interactive platform" have had limited impact. In 2026, rising memory prices are expected to directly affect sales of high-end standalone VR headsets, potentially delaying new product launches and leading to a continued decline in the overall VR market.
2. Technology Trends: Comprehensive Innovations in Display, Optics, and Interaction AR display and optical solutions evolve: Micro OLED captured 78% of the market share, with Sony leading at 60%. However, SeeYA Technology increased its share to 39% through deep collaboration with Thunderbird, supported by a successful RMB 2 billion IPO, signaling the rise of domestic supply chains. Monochromatic green Micro LED adoption accelerated in notification-focused AR glasses, with sales surging 203% year-on-year, largely driven by the popularity of Rokid Glasses. Although its share declined, Birdbath technology remained dominant with 75% market share, while Thunderbird and XREAL continued to make breakthroughs in cost-performance and user experience. Diffractive waveguide optics remain the primary choice, with one-engine-driving-two-optics emerging as the preferred low-cost solution.
VR display and optical solutions advance: Fast LCD led with 90% market share, while Micro OLED penetration in devices priced above RMB 5,000 rose to 62%. Pancake optics accounted for 52% of sales, with their slim design significantly improving portability. However, due to high manufacturing costs, Pancake's market share saw a slight decline in 2025. The supply chain is actively working to reduce costs through process optimization and material innovation. By 2026, lightweight VR devices combining Micro OLED and Pancake optics with a field of view under 90 degrees are expected to launch, leading to a modest increase in market share.
3. Pricing and User Behavior: Diverging Trends AR devices are becoming more affordable due to scaled production, lowering the barrier to entry for new users. At the same time, high-end AR headsets and all-in-one AR glasses from brands like XREAL, VITURE, and Quark are targeting premium price segments. In the VR segment, devices priced between RMB 4,000–5,000 accounted for 33% of sales, led mainly by PICO 4 Ultra. Despite overall sluggish sales, core users showed a greater willingness to pay a premium for immersive technology, indicating structural upgrades in the high-end market. In the fourth quarter, Pimax Crystal Super ranked first in the above-RMB 5,000 segment with its ultra-high resolution and premium pricing, targeting professional and enthusiast users.
4. Brands: Domestic Brands Dominate, Thunderbird and PICO Lead in AR and VR Respectively In the AR market, Thunderbird maintained its leading position with a 32% sales share and 60% year-on-year growth. Its competitive edge stems from a comprehensive product portfolio covering both professional and everyday consumer scenarios. XREAL followed with an 18% share, leveraging its expertise in split-type headsets to push the boundaries of field of view and processing power. A strategic partnership with Google to develop a spatial computing platform based on Android XR further strengthens its ecosystem. Rokid Glasses, under Leqi, saw strong sales in the second half of the year, repeatedly topping single-product sales charts and becoming a breakout product. Alibaba’s year-end launch of the all-in-one AR glasses S1 set a new benchmark in functional integration, combining Tongyi large model capabilities with Gaode Navigation, Alipay, and Taobao's image search.
In the VR segment, PICO maintained a leading position with over 40% market share. Meta rapidly increased its share to over 30% in 2025, forming a duopoly with PICO in the industry.
5. Investment and Ecosystem Development: Capital Flows to Technology-Driven Projects Global VR/AR industry financing reached RMB 54.9 billion in 2025, with China accounting for RMB 5.08 billion (including seven undisclosed amounts), an increase of RMB 610 million from the previous year. AR hardware and terminal manufacturers were the primary focus of investment, with significant funding rounds including JBD (RMB 1.33 billion), SeeYA (RMB 600 million), Hongxi (RMB 500 million), VITURE (RMB 710 million), Rokid (RMB 600 million), and XREAL (RMB 200 million).
In 2025, China's consumer XR market underwent structural transformation guided by policy support, technological breakthroughs, and ecosystem restructuring. AR's portability, lightweight design, and scenario adaptability enabled it to surpass VR, while VR deepened its application value in professional fields. With the deployment of 5G-A/6G, integration of AI large models, and maturation of wearable ecosystems, XR devices are poised to evolve into the "next-generation computing platform," ushering in a new era of intelligent human-machine interaction.