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Xreal, Google’s smart glasses partner, believes it has finally cracked the notoriously difficult industry
The smart glasses sector has long been a frustrating pursuit for Silicon Valley. The concept is straightforward: imagine enjoying mobile computing without being glued to your screens, opting instead for a lightweight wearable. Tech enthusiasts, who are heavily represented in the industry, clearly see the appeal of this vision.
Yet, for most of the past decade, the market has acted like a financial sinkhole, absorbing massive investments while delivering minimal returns.
“Everyone is losing money,” noted Chi Xu, founder and CEO of Xreal, a smart glasses maker and long-time Google partner. I spoke with Xu at Google’s I/O conference in Mountain View last week, where he showcased Xreal’s Project Aura. This initiative aims to deliver functional XR glasses that users actually desire.
“What we’re doing is incredibly difficult,” he explained.
Historically, smart glasses faced obvious hurdles: bulky designs, discomfort, and social stigma, combined with software that offered little value. Today, however, industry leaders like Xu believe the sector has crossed a critical threshold.
This turning point is partly driven by Meta, whose 2023 collaboration with Ray-Ban launched one of the few smart glasses lines to achieve significant sales volume. Notably, Meta’s Reality Labs division continues to operate at a substantial loss.
As hardware shrinks and software matures, Xu believes Xreal is poised to lead the market. “You need all the essential components aligned—functional hardware, a robust operating system, and an intuitive user interface,” Xu stated.
Xreal’s latest model, Aura, features embedded OLED displays, allowing users to view high-resolution video directly through the lenses. The device connects to a “puck,” a compact, phone-sized computer that powers the experience. While the puck can be tucked into a pocket, its presence adds some bulk.
Despite this trade-off, users gain access to diverse features, including an immersive Google Maps application, VR YouTube content, and a “painting app” that uses hand tracking to create personal holographic art. The glasses also support hand-tracked games and basic web browsing.
“Whether you’re following a floating recipe while cooking, setting up a private workspace in a coffee shop or on a plane, or watching a movie on a virtual big screen at home, the experience is seamless,” the company claims.
Xu envisions the device serving both casual users and professionals. “It’s not just about watching NBA games in a holographic format; you can also head to a coffee shop and get work done,” he said.
Currently available only to developers, the glasses are scheduled for a commercial launch later this year. Xreal is also preparing for an IPO, expected before the end of 2026, though Xu provided few details regarding the timeline.
Meanwhile, the company is focusing on profitability. Xu highlighted that Xreal has been increasing gross margins while reducing marketing and sales expenses. “Next year is when we expect to break even,” he affirmed.
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The smart glasses sector has long been a frustrating pursuit for Silicon Valley. The concept is straightforward: imagine enjoying mobile computing without being glued to your screens, opting instead for a lightweight wearable. Tech enthusiasts, who are heavily represented in the industry, clearly see the appeal of this vision.
Yet, for most of the past decade, the market has acted like a financial sinkhole, absorbing massive investments while delivering minimal returns.
“Everyone is losing money,” noted Chi Xu, founder and CEO of Xreal, a smart glasses maker and long-time Google partner. I spoke with Xu at Google’s I/O conference in Mountain View last week, where he showcased Xreal’s Project Aura. This initiative aims to deliver functional XR glasses that users actually desire.
“What we’re doing is incredibly difficult,” he explained.
Historically, smart glasses faced obvious hurdles: bulky designs, discomfort, and social stigma, combined with software that offered little value. Today, however, industry leaders like Xu believe the sector has crossed a critical threshold.
This turning point is partly driven by Meta, whose 2023 collaboration with Ray-Ban launched one of the few smart glasses lines to achieve significant sales volume. Notably, Meta’s Reality Labs division continues to operate at a substantial loss.
As hardware shrinks and software matures, Xu believes Xreal is poised to lead the market. “You need all the essential components aligned—functional hardware, a robust operating system, and an intuitive user interface,” Xu stated.
Xreal’s latest model, Aura, features embedded OLED displays, allowing users to view high-resolution video directly through the lenses. The device connects to a “puck,” a compact, phone-sized computer that powers the experience. While the puck can be tucked into a pocket, its presence adds some bulk.
Despite this trade-off, users gain access to diverse features, including an immersive Google Maps application, VR YouTube content, and a “painting app” that uses hand tracking to create personal holographic art. The glasses also support hand-tracked games and basic web browsing.
“Whether you’re following a floating recipe while cooking, setting up a private workspace in a coffee shop or on a plane, or watching a movie on a virtual big screen at home, the experience is seamless,” the company claims.
Xu envisions the device serving both casual users and professionals. “It’s not just about watching NBA games in a holographic format; you can also head to a coffee shop and get work done,” he said.
Currently available only to developers, the glasses are scheduled for a commercial launch later this year. Xreal is also preparing for an IPO, expected before the end of 2026, though Xu provided few details regarding the timeline.
Meanwhile, the company is focusing on profitability. Xu highlighted that Xreal has been increasing gross margins while reducing marketing and sales expenses. “Next year is when we expect to break even,” he affirmed.
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