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Virtual Reality (VR) Market Size, Share & COVID-19 Impact Analysis, By Component (Hardware, Software, and Content), By Device Type (Head Mounted Display, VR Simulator, VR Glasses, Treadmills & Haptic Gloves, and Others), By Industry (Gaming, Entertainment, Automotive, Retail, Healthcare, Education, Aerospace & Defense, Manufacturing, and Others), and Regional Forecast, 2021-2028

Region : Global | Format: PDF | Report ID: FBI101378



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The global virtual reality market size was USD 4.42 billion in 2020. The devices considered in the scope are Vuzix iWear, Sony PlayStation VR, Dell Visor, Samsung Gear, Vive Cosmos, Google Daydream, among others. The global impact of COVID-19 has been unprecedented and staggering, with virtual reality witnessing a negative impact on demand across all regions amid the pandemic. Based on our analysis, the global market exhibited a significant growth of 42.2% in 2020 compared to the average year-on-year growth during 2017-2019. The market is projected to grow from USD 6.30 billion in 2021 to USD 84.09 billion in 2028 at a CAGR of 44.8% in the 2021-2028 period. The rise in CAGR is attributable to this market’s demand and growth, returning to pre-pandemic levels once the pandemic is over.

Virtual reality provides simulated experience to the customers and offers vast applications to industries such as retail, healthcare, automotive, gaming, and entertainment, among others. The industries adopt this immersive technology to conduct virtual training, assistance, marketing, engineering and maintenance, designing, and simulation activities with their employees and workers. Also, the technological advancement in the 5G infrastructure and technology is driving the market growth. The key market players are extensively focused on offering advanced hardware and content to improve customer experience. For instance,

  • In April 2021, Eon Reality Inc. announced the new update, EON-XR’s 9.0, which includes some additional features and improvements in earlier products. The updated version offers an improved and new interactive virtual reality environment to the users.

COVID Impact

Growing In-home Activities to Boost Market Growth Amid COVID-19

COVID-19 has highly impacted the work culture across the industries. The shutdown of manufacturing plants and the closure of countries' borders have impacted the supply chain and hardware production. Thus, for the short-term period, the pandemic has moderately impacted this market. On the other hand, people across the real world adopted virtual technology to improve health and wellbeing, entertainment, live shows, virtual conference, and meeting, among others. For instance, in April 2020, the artist Rapper Travis Scott adopted a virtual reality platform and attracted over 12 million views on its Fortnite video game. Thus, the pandemic is expected to reboot the technology adoption and is likely to surge the market growth in the long run.


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5G Connectivity to Offer New Potential of Virtual Reality (VR) Market Growth

The widespread implementation of the 5G network is boosting the adoption of virtual technology. The 5G services offer high-bandwidth and ultra-low latency. This supports the adoption of the technology for virtual reality applications such as entertainment, training, simulation, and more. The 5G connectivity offers new opportunities for the market companies to boost the revenue scale by offering uninterrupted, high resolution, better performing virtual technology. The connectivity helps users in attaining continuous and enhanced virtual environment experience.

The 5G industry players and immersive technology providers collaborate to offer an enhanced virtual environment through the 5G technology standalone. For instance, in February 2021, the companies such as The Original Content Company (TOCC) and Vodafone has collaborated with Xpllore, Gamoola, and The Grid Factory to build a vi Anatomical Learning platform on its 5G technology. As a result, the 5G technology provides huge opportunities to the market players to bring the live immersive experience to the users. Thus, 5G is expected to boost the market opportunities during the forecast period.  


Rising Demand for Virtual Training Across Industries to Drive the Market

Industries such as automotive, education, healthcare, aerospace & defense, and more are significantly investing in virtual training solutions. For instance, in the automotive industry, the virtual training module offers workstation training for new joiners to avoid accidents; as per Ford’s report of 2015, employee injuries and accidents reduced by 70% with the help of virtual training sessions. The system provides hands-on training for newcomers using headsets, simulators, glasses, and more. In addition, the retail industry has now started implementing VR technologies to maintain customer relationships. For instance, in July 2019, Walmart accomplished 15 minutes training modules instead of its earlier 8 hours’ modules with the help of virtual training tools.

Similarly, the healthcare industry is utilizing virtual training solutions across its services. Training helps the healthcare providers in improving the operating accuracy with zero error. Similarly, in gaming and entertainment, the NFL and other American Football teams are using the technology for training to reduce the injury risk. This is expected to drive the market in the forthcoming years.


Requirement of High Speed and Computation Power to Hamper the Market

The technology demands robust hardware components and high computing power. However, the majority of current desktop accessories are not compatible with applications. Similarly, most head-mounted displays are wireless and consume high energy, requiring high-energy batteries for long-duration operations. In industries such as gaming and entertainment, it is necessary to have devices with long battery life. Further, the highly connected devices and components require high-speed network bandwidth such as 5G. Thus, the lack of suitable speed and power for operating the system might challenge the market growth.


By Component Analysis

Growing Investments in Advanced Hardware Offerings to Drive Market Growth

Based on components, the is segmented market is categorized into hardware, software, and content. The hardware segment is expected to dominate the global virtual reality market share during the forecast period. The key players are highly investing in the launch and innovation of hardware. For instance, in May 2021, Axon launched its virtual reality-based wireless simulator to provide hands-on training-focused solutions.

The software is likely to gain traction owing to the rising demand for immersive technology.

Software considered for the market study are Vizard VR Software, Amazon Sumerian, Cryengine, AutoDesk 3ds Max to name a few. Increasing demand for applications such as gaming, entertainment, and live events is augmenting the software demand. The content segment is expected to witness steady growth during the forecast period due to the increasing demand for interactive virtual sessions. The industries are demanding new content for the application, such as marketing, training, entertainment, gaming, and other sections.

By Device Type Analysis

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Rapidly Growing Demand for Head-Mounted Display across Industry Applications to Fuel Market Growth

Based on device type, the market is categorized into Head Mounted Display (HMD), VR simulator, VR glasses, treadmills & haptic gloves, and others.

HMD is expected to lead the market, as it offers the most immersive environment through the devices. Some of the HMD offered by key players are Oculus Rift, HTC Vive, Microsoft Hololens, StarVR HMD, among others. With technological development, the demand for smartphone-connected headsets is growing due to low-cost investment, such as Google’s low-cost drawing board-based headsets. The adoption of HMD is significantly growing in industrial applications such as training, marketing, entertainment, and more. For instance, in April 2021, Vajro and VRM Switzerland officially qualified by the European Union Aviation Safety Agency for VR-based aviation training. The companies in collaboration have built a human-eye resolution-based headset for pilot training.

These simulators are getting implemented for training, designing, and prototyping across industries as they help reduce expenses. For instance, in March 2019, Nissan collaborated with Haptx to provide a realistic car designing virtual simulator to reduce time and investment. Similarly, with the increasing demand, entertainment and gaming industries are vastly adopting treadmills and haptic gloves. This is likely to ensure a highly immersive environment for the customers. Therefore, the adoption of VR glasses for training and education is expected to grow during the forecast period.

By Industry Analysis

Growing Investments by Automotive Industry on Advanced Training Tools to Boost Market Growth

Based on industries, the market is segmented into gaming, entertainment, automotive, retail, healthcare sector, education, aerospace & defense, manufacturing sector, and others. The increased adoption of technology in the automotive industry majorly caters to the training and education of engineers and technicians. Some of the VR tools and solutions for the automotive industry application are Autodesk VRED, Ford’s Virtual Reality Lab, Rift DK2 headset for Audi Virtual Training, and more. Similarly, the implementation of VR simulators for test driving is boosting showroom customer engagement. For instance, in September 2020, Mercedes-Benz announced the partnership with Microsoft Corporation for its HoloLens 2 VR goggles and Dynamics 365 Remote Assist, to improve its customer experience.

This technology has been effectively implemented across the healthcare industry. It provides visual and controlled environments for healthcare workers to perform or diagnose the issue. For instance, healthcare providers are using such simulators to understand Alzheimer’s, help autistic patients, detect impaired vision, and other applications.

The gaming and entertainment segment is expected to dominate the market during the forecast period. The existing and new players are investing in developing content, software, and hardware specifically for gaming purposes. The rising demand for theme parks, virtual museums, gaming arcades is further boosting the market growth. Similarly, the retail and education industries are steadily adopting technology for various applications. This is likely to boost the market in the near future.


North America Virtual Reality (VR) Market Size, 2020 (USD Billion)

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Geographically, the market is fragmented into five major regions: North America, Europe, Asia Pacific, the Middle East & Africa, and Latin America. They are further categorized into countries.

North America is expected to dominate the market share. The significant presence of key players in the United States is driving the market growth in the region. Also, various start-ups are entering the US market and offering industry-specific solutions. For instance, in October 2020, California-based small company, Sixense Enterprises Inc., launched a VR-based physical rehabilitation system called the REAL Immersive System. The US government is also investing the virtual technology; this is likely to boost the market. For instance, the US government and its army have invested 11 billion in providing virtual, augmented, and mixed reality training sessions to its officials.

Asia Pacific shows rapid growth during the forecast period due to the increasing demand for immersive technologies in emerging economies. China is likely to gain maximum market share, as it is one of the major distributors of head-mounted devices and other hardware. Also, the developments in 5G networks and infrastructure in China are expected to boost the market opportunities. On the other hand, India is likely to witness significant growth owing to government initiatives and funding. Also, industries such as entertainment, retail, automotive, education, and more are collaborating with market players to implement the technology to enhance customer experience. For instance, in May 2021, a real-time engagement (RTE) provider, Agora, Inc., collaborated with HTC VIVE to implement virtual reality technology with its RTE to offer an improved experience to businesses and customers.

Europe is likely to show significant growth during the forecast period. The region is the early adopter of virtual solutions in the automotive industry. According to the report published by European Commission, the European augmented reality (AR) and virtual reality industry is expected to increase its production value to USD 38 billion by 2020. The UK and Germany are likely to gain traction owing to the increasing investment in the market.

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Latin America is expected to gain steady growth owing to increasing government focus on advanced technologies and rapid installation of 5G infrastructure. The growing interest in VR-enabled gaming and entertainment users boosts the demand in the Middle East and Africa.


Key Players Are Keen on Offering Advanced Solution to Enhance Customer Experience

The prominent players of the market are aiming to provide advanced virtual solutions to improve the consumer experience. Majorly players are keen on enhancing the hardware to uplift the virtual impact on the users. Companies such as HTC Corporation, Oculus, Sony Corporation, and Lenovo Group are investing in further developments in their head-mounted devices. The players are entering into strategic acquisition and partnerships to expand their customer reach. Also, the key players are offering industry-specific content and software to expand their business dimensions. The market is also witnessing the significant entry of small and medium enterprises.

October 2020 – Facebook LLC announced the launch of a VR headset, Oculus Quest 2, available via oculus.com and in stores. The new wireless unit offers an improved resolution. The company is also focusing on offering next-level virtual tools.

March 2021 –  HTC Corporation’s HTC VIVE launched VIVE Facial Tracker and VIVE Tracker (3.0) to enhance the virtual reality ecosystem with advanced innovation. Its new facial tracker provides real-time depiction and movement of the lower facial area.


  • Crytek GmbH (Frankfurt, Germany)

  • Eon Reality Inc. (California, U.S.)

  • HTC Corporation (Taoyuan City, Taiwan)

  • Oculus Rift (Facebook Inc.) (California, U.S.)

  • Pico Interactive Inc. (California, U.S.)

  • Sensics, Inc. (Maryland, U.S.)

  • Sixense Enterprises Inc. (California, U.S.)

  • StarVR Corporation (Taipei, Taiwan)

  • Ultraleap Ltd. (Bristol, England)

  • Unity Technologies (California, U.S.)

  • Survios, Inc. (California, U.S.)


  • May 2021 – Pico Interactive Inc. launched its enterprise 6DoF VR headsets available in North America, Europe, and China. The new headsets are powered by its Neo line Neo 3 Pro and Neo 3 Pro Eye.

  • May 2020 – Apple Inc. announced the acquisition of NextVR, a virtual reality event startup. The NestVR, over the period, has gained expertise in recording live events to showcase through virtual reality headsets.


An Infographic Representation of Virtual Reality Market

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The global virtual reality market research report highlights leading regions across the world to offer a better understanding of the user. Furthermore, the report provides insights into the latest VR industry trends and analyzes technologies deployed at a rapid pace at the global level. It further highlights some of the growth-stimulating factors and restraints, helping the reader gain in-depth knowledge about the market.




Study Period


Base Year


Estimated Year


Forecast Period


Historical Period



  Value (USD Billion)


  Component; Device Type; Industry; and Region

By Component

  • Hardware

  • Software

  • Content

By Device Type

  • Head Mounted Devices

  • VR Simulator

  • VR Glasses

  • Treadmills & Haptic Gloves

  • Others

By Industry

  • Gaming

  • Entertainment

  • Automotive

  • Retail

  • Healthcare

  • Education

  • Aerospace & Defense

  • Manufacturing

  • Others

By Region

  • North America (By Component, By Device Type, By Industry, and By Country)

    • U.S. (By Device Type)

    • Canada (By Device Type)

  • Europe (By Component, By Device Type, By Industry, and By Country)

    • U.K. (By Device Type)

    • Germany (By Device Type)

    • France (By Device Type)

    • Scandinavia (By Device Type)

    • Rest of Europe

  • Asia Pacific (By Component, By Device Type, By Industry, and By Country)

    • China (By Device Type)

    • Japan (By Device Type)

    • India (By Device Type)

    • Southeast Asia (By Device Type)

    • Rest of Asia Pacific

  • The Middle East & Africa (By Component, By Device Type, By Industry, and By Country)

    • GCC (By Device Type)

    • South Africa (By Device Type)

    • Rest of the Middle East & Africa

  • Latin America (By Component, By Device Type, By Industry, and By Country)

    • Brazil (By Device Type)

    • Mexico (By Device Type)

    • Rest of Latin America

Frequently Asked Questions

The market is projected to reach USD 84.09 billion by 2028.

In 2020, the market size stood at USD 4.42 billion.

The market is projected to grow at a CAGR of 44.8%.

The head-mounted display device type is likely to lead the market.

Rising demand for virtual training across industries is likely to drive market growth.

Google LLC, Oculus Rift (Facebook Inc.), Sony Corporation, Unity Technologies, HTC Corporation, Apple Inc., Samsung Electronics Co. Ltd., Lenovo Group Ltd., Microsoft Corporation, and Autodesk Inc. are the top players in the market.

North America is expected to hold the highest market share.

Automotive in industry segment is expected to grow with the remarkable CAGR.

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Virtual Reality Market Size, Share and Global Industry Trend Forecast till 2026
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