Augmented and Virtual Reality Market worth $138.60 billion by 2032 - Exclusive Report by MarketsandMarkets™

DELRAY BEACH, Fla., Jan. 15, 2026 /PRNewswire/ -- According to MarketsandMarkets™, the Augmented and Virtual Reality Market is estimated to reach USD 138.60 billion by 2032 from USD 40.62 billion in 2025, at a CAGR of 19.2% from 2025 to 2032.

Browse 150 market data Tables and 50 Figures spread through 250 Pages and in-depth TOC on " Augmented and Virtual Reality Market - Global Forecast to 2032"

Augmented and Virtual Reality Market Size & Forecast:

• Market Size Available for Years: 2021–2032
• 2025 Market Size: USD 40.62 billion
• 2032 Projected Market Size: USD 138.60 billion
• CAGR (2025–2032): 19.2%

Gesture Recognition and Touchless Sensing Market Trends & Insights:

• Governments worldwide are fostering the growth of the AR market through various forms of support, such as funding, research and development assistance, startup grants, and partnerships with academic institutions.
• By technology, augmented reality accounted for a market share of 49.8% in 2024.
• By offering, the augmented reality software segment accounted for a market share of 87.5% in 2024.
• By application, enterprise and consumer applications are expected to account for the largest market share in 2024.
• By region, North America accounted for the largest market share of 35.6% in 2024.

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The major factors driving the growth of the AR and VR market include the increasing adoption of AR and VR in the entertainment and gaming industries, the growing adoption of AR in the retail and e-commerce sectors, and the increasing need for remote work and virtual classrooms, which fuel the adoption of VR technologies. Moreover, the growing demand for AR and VR technologies in the telemedicine industry presents future growth opportunities for market players. The major factors driving the growth of the augmented and virtual reality market include the increasing adoption of AR and VR in the entertainment and gaming industries, the growing adoption of AR in the retail and e-commerce sectors, and the increasing need for remote work and virtual classrooms, which fuel the adoption of VR technologies. Moreover, the growing demand for AR and VR technologies in the telemedicine industry presents future growth opportunities for market players.

Gesture-tracking devices segment to witness the highest growth rate in the AR and VR market during the forecast period.

The market for VR is anticipated to see significant growth in head-mounted displays. Companies such as Sony, Oculus, HTC, Samsung, Google, TLC Alcatel, and Osterhout Design Group have gained considerable recognition among users. The primary applications of head-mounted displays are in the entertainment and gaming sectors, and it is forecasted that these sectors will continue to dominate the market in the coming years. Furthermore, devices that facilitate gesture tracking play a crucial role in enhancing the virtual reality experience. The adoption of gesture-tracking devices is expected to drive substantial growth in the VR market.

Hardware held the largest share of the AR market in 2024.

In 2024, the hardware segment held the largest share of the AR market, driven by increasing demand for headsets, smart glasses, and sensors essential for creating immersive experiences. Head-mounted displays (HMDs) are the main contributors in this sector. This can be attributed to the significant innovations occurring in hardware, which address client needs by enabling the creation of real-time overlays.

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The Asia Pacific region is expected to witness the highest growth rate during the forecast period.

The AR/VR industry is projected to experience significant growth in the Asia Pacific region, driven by the rapid expansion of digital infrastructure and the vast consumer bases in China, India, and Japan. Government initiatives, such as "Made in China 2025" and the Digital India program, are making significant investments in AR/VR technologies for sectors like manufacturing, education, and smart cities, thereby accelerating their adoption. Additionally, the booming gaming, e-commerce, and enterprise sectors, along with the widespread availability of affordable hardware, are driving market penetration and innovation at a faster pace than in other regions. The ongoing deployment of 5G technology and the establishment of tech manufacturing hubs further reinforce the region's leadership in the deployment of immersive technologies.

The major players in the AR and VR companies with a significant global presence are Meta (US), Apple, Inc. (US), Google (US), Microsoft (US), PTC (US), Sony Corporation (Japan), ByteDance (China), DPVR (China), HTC Corporation (Taiwan), and Samsung (South Korea).

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