Can Xreal’s latest innovation raise the bar in augmented reality technology?

On December 5, Xreal unveiled its latest innovation in augmented reality (AR) technology: the Xreal One. Priced at RMB 3,299 (USD 461.9), the new AR glasses feature a broader field of view, enhanced clarity, a higher global refresh rate, and an acoustic system fine-tuned by Bose.

The centerpiece of the launch is Xreal’s proprietary X1 spatial computing chip, a major leap forward for the company. Founder and CEO Chi Xu called it “one of the most significant innovations” since lightweight, portable, and wired AR glasses became a reality.

But why create a proprietary chip?

General-purpose chips, Xu explained, fail to meet the unique demands of AR technology. Latency, power efficiency, and spatial computing optimization often fall short. To address these gaps and deliver an improved user experience, Xreal funneled part of its Series C funding from 2021 into developing the X1 chip. After three years of R&D, the chip has now entered mass production.

Dubbed the “brain” of the Xreal One, the X1 chip powers ultra-low-latency, perception-driven computing and cross-device compatibility. According to Xreal, the chip achieves latency as low as 3 milliseconds—a quarter of the Apple Vision Pro’s performance—and ensures seamless integration with devices across ecosystems, including iPhones, Android phones, Windows PCs, and MacBooks.

Speaking with 36Kr, Xu said that the X1 chip has allowed Xreal to make “the most portable and best-performing display ever.” He projected sales of at least 600,000 units, calling it a conservative estimate.

Xreal holds a dominant position in China’s AR glasses market, with IDC data indicating it captured 47.2% of global market share in the first half of 2024. However, the rise of AI glasses has added a new layer of competition. Meta’s AI glasses, the Ray-Ban Meta, launched in 2023 and surpassed 1 million units sold, sparking a surge of interest in this product category.

Xu attributed the popularity of AI glasses to their status as fashionable tech accessories rather than cutting-edge AI devices. “Today’s AI glasses are still rudimentary and fall short in areas like photography, lightweight design, and chip performance,” he said.

That said, Xreal is not sidelining AI glasses entirely. Xu confirmed the company has a team dedicated to their development as part of its long-term vision. For now, however, the focus remains on refining its AR glasses.

Beyond AR and AI glasses, head-mounted spatial computing devices, such as the Apple Vision Pro, represent a third segment in the smart glasses market. Despite their advanced technology, these devices remain bulky and lack the portability needed for widespread adoption.

Xu views the popularization of spatial computing devices as a long-term challenge requiring more than high-performance hardware. In his view, it will take a large ecosystem and a robust developer base, and no single company can achieve this alone.

With the industry still in its early stages, Xreal’s strategy is clear: remain in the game long enough, and create truly exceptional products once the technology matures.

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