IDC Predicts China’s AR/VR Market to Exceed $13B in 2026

Research institution IDC recently released the “Worldwide Augmented and Virtual Reality Spending Guide.” The report looks forward to the development of the AR and VR market in the next five years from multiple dimensions, such as reality types, technology, industry users and applications.

According to IDC’s latest forecast data, the global AR/VR total investment scale was close to $14.67 billion in 2021, and is expected to increase to $74.73 billion in 2026, with a compound annual growth rate (CAGR) of 38.5%. Specifically, the CAGR of the Chinese market is expected to reach 43.8% in five years, ranking first in the world.

In 2021, with the entry of leading internet companies, China’s AR/VR market has been injected with great vitality and has broad development prospects. IDC predicts that IT-related expenditure in China’s AR/VR market will be about $2.13 billion in 2021 and will increase to $13.08 billion in 2026, making it the second-largest market in the world. Specifically, AR expenditure will increase rapidly with a 49.0% five-year CAGR, while VR expenditure will maintain steady growth with a 41.5% five-year CAGR. VR technology is still the main area of users’ attention in the five-year forecast period from 2022 to 2026, and it is expected to attract about 70% of AR/VR market related investment.

From a technical perspective, many new products have been introduced in China’s AR/VR market in 2021, and they will continue to upgrade in 2022. According to IDC’s latest forecast data, the hardware market will grow steadily with a compound growth rate of 47.8%, and it will continue to occupy more than half of China’s AR/VR expenditure.

As far as the AR market is concerned, IDC predicts that in 2026, Training-AR, Industrial Maintenance and Laboratory Field (Post-Secondary) will become mainstream application scenarios, accounting for about 30.1% of investment for the AR market in China.

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From the perspective of the VR market, the quantity and quality of game applications targeting individual consumers have obviously improved. IDC predicts that throughout the next five years, VR Games will account for 30% of the VR market. In 2026, VR games, training-VR and VR collaboration are expected to become the main application scenarios of VR in China, accounting for more than 50%.