Hyderabad, Feb. 20, 2026 (GLOBE NEWSWIRE) -- According to a new report published by Mordor Intelligence, the augmented reality market was valued at USD 125.11 billion in 2026 and is projected to reach USD 387.23 billion by 2031, growing at a CAGR of 25.35%. Expansion is being driven by continued 5G rollouts, stronger cloud-edge infrastructure, and enterprise pilots transitioning into full-scale deployments. Generative AI tools are reducing content creation costs and expanding developer participation, while premium and mass-market hardware strategies are accelerating adoption. In industrial settings, proven efficiency gains in training and remote support are encouraging long-term enterprise investments.
New Innovations Accelerating AR Market Growth
AI-Powered Acceleration of AR Content Creation
AI-driven creation tools are making AR development faster and more accessible, turning simple text inputs into ready-to-use 3D environments. Major cloud platforms and creative-tech firms are enabling brands to build virtual experiences almost instantly, while new streaming techniques help deliver detailed visuals without heavy bandwidth demands. In industrial settings, AI can transform existing design files into interactive holograms, reducing the effort traditionally required from specialist teams. As these tools evolve, AR production becomes easier, helping the technology scale across more industries.
Smartphones as the Gateway to AR Adoption
Growing smartphone adoption is making mobile devices the easiest entry point for everyday AR use, especially as retailers experiment with interactive product previews that keep users engaged longer. While phone-based AR still faces accuracy challenges in indoor environments, ongoing improvements in supporting technologies are gradually smoothing the experience. For now, smartphones continue to anchor the AR ecosystem, helping developers refine applications as the industry moves toward wider use of lightweight AR wearables.
Augmented Reality Market Share by Region
Asia-Pacific is becoming the core driver of AR growth, supported by strong government funding, advanced research infrastructure, and an expanding tech manufacturing base. China’s push for local innovation, Japan’s leadership in high-performance computing, and South Korea’s investment in immersive technologies all strengthen the region’s momentum. With a massive mobile user base, the market is well positioned to scale AR hardware and applications quickly.
North America continues to lead the AR landscape, driven by strong enterprise uptake and widespread 5G availability. Steady government demand for secure and durable devices supports industry stability, while clear regulatory pathways help accelerate medical use cases. The region also benefits from concentrated venture funding in major tech hubs, with many emerging AR platforms extending their manufacturing links across North America to strengthen the ecosystem.
Table of Contents (Partial) - Augmented Reality (AR) Market
1. INTRODUCTION
- 1.1 Study Assumptions and Market Definition
- 1.2 Scope of the Study
2. RESEARCH METHODOLOGY
3. EXECUTIVE SUMMARY
4. MARKET LANDSCAPE
- 4.1 Market Overview
- 4.2 Market Drivers
- 4.2.1 5G-enabled low-latency mobile networks
- 4.2.2 Rising smartphone penetration and AR-ready apps
- 4.2.3 Enterprise training and field-service efficiency gains
- 4.2.4 Generative-AI tools for rapid AR content creation
- 4.2.5 and more
- 4.3 Market Restraints
- 4.3.1 Battery-life and ergonomics of head-mounted displays
- 4.3.2 Privacy and data-security concerns
- 4.3.3 Optical-waveguide glass supply bottlenecks
- 4.3.4 and more
- 4.4 Value Chain Analysis
- 4.5 Regulatory Landscape
- 4.6 Technological Outlook
- 4.6.1 Cloud Computing
- 4.6.2 Artificial Intelligence
- 4.6.3 Cyber-Security
- 4.6.4 Digital Services
- 4.7 Porter's Five Forces Analysis
- 4.7.1 Bargaining Power of Suppliers
- 4.7.2 Bargaining Power of Buyers
- 4.7.3 Threat of New Entrants
- 4.7.4 Threat of Substitutes
- 4.7.5 Intensity of Competitive Rivalry
- 4.8 Investment Analysis
- 4.9 Assessment of the Impact of Macroeconomic Trends on the Market
5. MARKET SIZE AND GROWTH FORECASTS (VALUE)
- 5.1 By Offering
- 5.1.1 Hardware
- 5.1.1.1 Stand-alone HMDs
- 5.1.1.2 Tethered HMDs
- 5.1.1.3 and more
- 5.2 By Core Technology
- 5.2.1 OLED / Micro-OLED
- 5.2.2 MicroLED
- 5.2.3 Waveguide and Diffractive Optics
- 5.2.4 and more
- 5.3 By Application
- 5.3.1 Remote Assistance and Maintenance
- 5.3.2 Product Visualisation and Configuration
- 5.3.3 Navigation and Mapping
- 5.3.4 and more
- 5.4 By End-user Vertical
- 5.4.1 Gaming and Entertainment
- 5.4.2 Education
- 5.4.3 Healthcare
- 5.4.4 and more
- 5.5 By Geography
- 5.5.1 North America
- 5.5.1.1 United States
- 5.5.1.2 Canada
- 5.5.1.3 Mexico
- 5.5.2 Europe
- 5.5.2.1 Germany
- 5.5.2.2 United Kingdom
- 5.5.2.3 France
- 5.5.2.4 Italy
- 5.5.2.5 Spain
- 5.5.2.6 Rest of Europe
- 5.5.3 Asia-Pacific
- 5.5.3.1 China
- 5.5.3.2 Japan
- 5.5.3.3 India
- 5.5.3.4 South Korea
- 5.5.3.5 Australia
- 5.5.3.6 Rest of Asia-Pacific
- 5.5.4 South America
- 5.5.4.1 Brazil
- 5.5.4.2 Argentina
- 5.5.4.3 Rest of South America
- 5.5.5 Middle East and Africa
- 5.5.5.1 Middle East
- 5.5.5.1.1 Saudi Arabia
- 5.5.5.1.2 United Arab Emirates
- 5.5.5.1.3 Turkey
- 5.5.5.1.4 Rest of Middle East
- 5.5.5.2 Africa
- 5.5.5.2.1 South Africa
- 5.5.5.2.2 Egypt
- 5.5.5.2.3 Nigeria
- 5.5.5.2.4 Rest of Africa
6. COMPETITIVE LANDSCAPE
- 6.1 Market Concentration
- 6.2 Strategic Moves
- 6.3 Market Share Analysis
- 6.4 Company Profiles (includes Global level Overview, Market level overview, Core Segments, Financials as available, Strategic Information, Market Rank/Share for key companies, Products and Services, and Recent Developments)
- 6.4.1 Microsoft Corporation
- 6.4.2 Google LLC (Alphabet)
- 6.4.3 Meta Platforms Inc.
- 6.4.4 Apple Inc.
- 6.4.5 Snap Inc.
- 6.4.6 Niantic Inc.
- 6.4.7 PTC Inc.
- 6.4.8 Vuzix Corporation
- 6.4.9 Magic Leap Inc.
- 6.4.10 and more
7. MARKET OPPORTUNITIES AND FUTURE OUTLOOK
- 7.1 White-space and Unmet-need Assessment
For details on other market segments and the full table of contents, visit - https://www.mordorintelligence.com/industry-reports/augmented-reality-market?utm_source=globenewswire
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Extended Reality (XR) Market Size - The extended reality market reached USD 10.64 billion in 2026 and is projected to surge to USD 59.18 billion by 2031, registering a CAGR of 40.95%. This growth is driven by enterprise digital transformation, immersive training adoption, and rapid deployment in healthcare, manufacturing, and retail. Advancements in 5G, edge computing, and lightweight wearable devices are strengthening the ecosystem and enabling high-fidelity immersive experiences at scale.
Virtual Reality (VR) Market Trends - The virtual reality market is estimated at USD 15.64 billion in 2026 and is projected to reach USD 40.71 billion by 2031, advancing at a CAGR of 21.08%. Key drivers include increasing use of VR in gaming, enterprise training, education, and digital simulation, supported by improved display technologies and falling hardware costs. Growing adoption of VR headsets for remote collaboration and virtual prototyping further fuels market expansion.
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