XR headset market declined 33% in Q1 2023: Report

(Image: Meta)

The Global XR headsets market, which cumulates both Augmented Reality (AR) and Virtual Reality (VR) headsets, declined 33 percent in the first quarter of 2023.

According to a report from Counterpoint Research, consumers seem to be losing interest in the market due to a long period of absence from Meta's Quest series.

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Meta retained its position as the best selling XR brand during the period, thanks to the prolonged success of the Meta Quest 2 headset which contributed to 18 million units of 20 million, that the Quest series cumulatively sold during the first quarter.

Meta recently announced the follow-up to Quest 2, the Quest 3 headset but it is not expected to ship until later this year.

In the absence of any new Meta hardware during the period, the performance of Quest 2 and Sony's PlayStation VR2 (PSVR2) saved the global market from a drastic decline.

While Meta holds 49 percent of the global headset market, Sony isn't far behind at 32 percent. The strong performance of PSVR2 resulted in it selling 1.2 million units more than its predecessor. Meta's share of 49 percent is also its lowest since it launched the Quest 2 in the fourth quarter of 2020.

Pico accounted for third place with a 7 percent market share, a decline of 38 percent in shipments despite being acquired by TikTok parent ByteDance.

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DPVR took fourth place with a market share of 6 percent, a decline of 40 percent thanks to delayed enterprise orders.

A lot of the new headsets expected to launch this year - Apple's Vision Pro, DPVR E4 and HTC Vive XR Elite - have all been priced above $500 limiting their commercial appeal and sales potential.