VR isn't dead, and 2025 has only proven how ridiculous those claims continue to be. That, and XR glasses have finally found their mojo

Grade: A

By all accounts, 2025 was a monumental year for XR. The term XR, which stands for eXtended Reality, covers VR, AR, and everything in between, constituting one of the few umbrella terms the industry seems to agree on. Everywhere you looked, the wearable face computer industry grew in 2025, and that all starts with VR.

Last year was pivotal for big-name VR releases, and while some of that continued into 2025 with titles like Deadpool VR, Alien: Rogue Incursion, Thief VR: Legacy of Shadows, and more, the real winners were the indies. That's because, for whatever reason, Meta Quest gamers seem to mainly gravitate toward smaller titles that get big word of mouth on social media.

Case in point is Animal Company, which garnered "over 1 billion views organically" on TikTok, according to a Meta developer profile blog post. That drove it to achieve the 5th-highest first-year revenue for a VR game, boasting over 1 million active monthly users and spawning a ton of clones. UG VR is another success story following the same mold of free-to-play titles with in-app DLC content.

The shift has made smaller teams happy, but it's also driven several companies out of business. Meta laid off several employees across its first-party VR development studios, and we also saw studio closures at established houses like Toast Interactive and WIMO Games. The silver lining here is that the Quest once again outsold most major consoles this Black Friday/Cyber Monday, according to publicly available info, a trend that's been a regular holiday tradition for years now.

All of this came to a head in early December when Meta decided to slice 30% of Reality Labs' budget starting in January 2026, a move that had been a long time coming as the department's spending had grown out of control over the years, while other Meta departments have taken 10% year-over-year cuts since 2022.

While that sounds bad initially, it's paving the way for a better, leaner Meta Quest. Two lead product and UI designers from Apple joined Meta in early December, and word on the street is that they'll have a hand in redesigning the Quest UI and in making the Quest 4 an ultra-light, sleek, gaming-first headset.

We're also seeing this shift because Meta finally has some real competition in the sector. Apple released a souped-up Vision Pro with a refreshed chipset and a more comfortable headstrap in August. Plus, Samsung finally launched the Galaxy XR headset alongside Android XR.

And to make things even better, we got to try Android XR running on Xreal's Project Aura smart glasses, which are set to release in 2026. That's a full VR headset operating system on a pair of light and comfortable smart glasses, and it's going to be a massive game-changer next year.

To top things off, Valve even announced a new VR headset called the Steam Frame. Frame runs a new version of SteamOS that's capable of not only running Windows VR games on a mobile chipset, but also Android games natively, as well. It's expected to make big waves, you guessed it, in early 2026.

The year smart glasses won

The VR industry has never seemed busier, but the smart glasses segment has never seen the success it had until 2025. Ray-Ban Meta Smart Glasses were the inflection point the industry needed, and Meta doubled down on its efforts to rule this segment for years to come.

The company ramped up production of its glasses back in February, then released a bevy of new glasses to glowing reviews in the fall. Ray-Ban Gen 2, Oakley Meta HSTN, Oakley Meta Vanguard, and Meta Ray-Ban Display Glasses all made huge waves and likely even better sales, solidifying Meta as the de facto smart glasses company after years of spending billions on R&D.

But the real standout was Meta Ray-Ban Display Glasses. These are the first consumer-ready pair of Meta's smart glasses with a display, and while they're expensive, they mark a pivotal point in the smart glasses race.

This was also the year we saw Google get serious about smart glasses again. We got our hands on Google and Samsung's prototype smart glasses back in May, and a follow-up Android XR event in December gave us even greater insight into the company's big plans for 2026.

But that doesn't just mean AI glasses to compete with Ray-Ban and Oakley Meta smart glasses; it also means utilizing partnerships with existing smart glasses companies. Magic Leap smart glasses powered by Android XR were shown off in October and will compete with Meta Ray-Ban Display Glasses, and Xreal Project Aura is going straight for the throat with a full VR UI in a comfortable pair of smart glasses.

Speaking of Xreal, the company launched the best smart display glasses we've seen to date all the way back in February, and the competition hasn't been able to keep up since.

Xreal One smart display glasses look similar to previous Xreal glasses from the outside, but they come packed with the first dedicated chipset for a pair like these, enabling spatial tracking for any device you plug them into. That's a game-changer because it means the virtual display looks and feels like a real display, anchored in physical space, no matter how you move.

Viture launched the Luma line, culminating in the Luma Ultra, and while they don't offer native spatial tracking like Xreal's glasses, they can give your Switch 2 an OLED on the go when paired with a Viture Pro Mobile Dock. And when paired with the Spacewalker mobile or PC apps, they can turn any 2D video into 3D using AI.

Rokid launched new AR glasses, with a second, more powerful pair teased in September. And folks looking for an affordable pair of smart display glasses can finally pick up $250 RayNeo models that don't feel like a compromise.

The wearable computer segment has taken a bit longer to "get good" than most tech pundits would have liked. But 2025 has proven that good things take time, and XR wearables are definitely getting really, really good.

The best year since 2020

The last time we saw this level of interest and excitement in VR (and XR as a whole) was back in 2020, when COVID kept everyone home, and the Oculus Quest 2 revolutionized VR gaming. While a significant number of announcements toward the latter half of the year won't materialize until early 2026, none of those products are vaporware, and they represent significant improvements in Meta's competition.

But it was also the year Meta continued to solidify its dominance across VR and smart glasses. The company has spent more than any other in this category, and it shows. Thankfully, that stranglehold on the market hasn't produced poor products. Rather, Meta's consistency has spurred competition, even in companies like Google, which we were very sure would never launch another pair of smart glasses or VR headsets until Android XR was announced.

If you're a VR enthusiast, exciting times are ahead as Meta, Valve, Apple, and Google aim to push the boundaries of what we've come to expect from standalone hardware. And anyone looking for a great pair of smart glasses already has several to choose from, with the proper killer pair of AR glasses (Xreal Project Aura) seemingly just around the corner.