Meta's smart AR glasses, Ray-Ban Display, have sold out explosively just one quarter after launch! IDC data reveals that Ray-Ban Display captured 6% market share in the smart AR glasses category during its first sales quarter. Moreover, due to "unprecedented strong demand" in the U.S., the product's waiting list now extends to 2026. Meta has paused its international expansion plans for early 2026 in the UK, France, Italy, and Canada to prioritize fulfilling U.S. orders. This extraordinary consumer enthusiasm has also led Meta to set higher future expectations. According to Bloomberg, Meta plans to double the production capacity of its AI-powered Ray-Ban glasses to 20 million units by 2026.
There has long been an unwritten consensus in the tech world: 10 million units is the critical threshold for an ecosystem. Only when hardware installations surpass 10 million units and maintain high activity levels can developers profit, enabling a virtuous cycle for the content ecosystem. Meta's bold move to double its production capacity seems to indicate that, at the very least, Meta itself has crossed this critical threshold. Simultaneously, this exponential capacity expansion not only demonstrates its own confidence but also carries significant defensive implications. After all, domestically in the U.S., Google is increasingly focusing on the smart AR glasses segment and ramping up its investments through acquisitions. Meanwhile, in markets like China, numerous large and small manufacturers are following Meta's lead and beginning to exert effort in this arena. In other words, Meta's production increase serves as a "warning signal" for the entire industry, and 2026 is certain to see many more players entering the market. Observing this rapidly accelerating sector, many marvel at the swift pace of technological progress but are even more curious: what is Meta's magic? How did it almost single-handedly ignite this market? The answer lies in the choice of core technology路线, empowered by upstream suppliers. The implementation of the LCoS solution might just be the key to the market's explosion. // Is LCoS the Secret Weapon of the "Warning Signal"? The Ray-Ban Display, which helped Meta cross the 10-million-unit threshold, features a major change compared to previous products: the choice of optical engine shifted from Micro LED to an LCoS solution. This adoption of the LCoS solution has brought about two significant product optimizations: First, regarding price, AR glasses are no longer unattainable luxury items and have become more affordable. Within the overall cost structure of AR glasses, the optical engine typically accounts for about 30%-40% of the Bill of Materials (BOM) cost, making it a core factor determining the final price. After adopting the LCoS路线, the price of Ray-Ban's product dropped significantly, from over a thousand dollars down to $799, allowing AR glasses to break out of the niche "luxury goods" circle. This is crucial for a brand-new hardware category. For innovative products that challenge existing perceptions, most consumers adopt a trial attitude. This means that lower price barriers and ease of use lead to more early adopters. In the internet era, everyone can act as both a product manager and a sales manager. A larger consumer base enables stronger network effects. These strong network effects, in turn, allow user feedback to drive rapid product iteration, further expanding market reach and forming a virtuous cycle of "low-price user acquisition - user growth - experience upgrade." This implies faster improvement cycles for new products and greater visibility among consumers. Second, regarding the product experience, the change in technology路线 also signifies a shift in Meta's overall product philosophy. Before Meta, most products in the industry resembled toys, prioritizing a "cool and flashy" experience. However, rigid demands like weight, battery life, and interaction were often overshadowed by this focus on novelty. Products with this "toy-like" attribute generate strong initial novelty for consumers, but toys inevitably lead to weariness. Simply put, lacking essential utility, once the novelty fades, usage frequency drops sharply, ultimately dooming them to obsolescence. Meta's new product sheds the obsession with peak performance, focusing instead on meeting consumers' mundane yet high-frequency essential needs. For instance, features like teleprompter functionality and translation are used almost daily by groups such as those in international trade. Concurrently, the glasses are lighter, have better battery life, and offer improved practicality. Therefore, sometimes, opting for superior technology can become a constraint when faced with high-frequency, mundane needs. Overall, Meta's success essentially stems from using the LCoS solution to precisely address the core pain points of AR glasses. This leads to the next question: What exactly is the appeal of the LCoS solution? I. Smaller Size A historical drawback of LCoS solutions was their large size, which increased the weight of glasses and affected aesthetics. However, much like a car with immense tuning potential, the LCoS方案 offers significant room for optimization. Theoretically, Professor Shin-Tson Wu's team at the University of Central Florida proposed using a waveguide structure to replace the traditional PBS illumination path, significantly reducing the volume of LCoS optical engines. An optical engine with 1024×1024 resolution could be miniaturized to 0.2cc (excluding the projection path). Practically, efforts from the supply chain in recent years have effectively started reducing volume and saving weight. For example, Appotronics Corporation Limited's "Dragonfly G1 mini" monocular optical engine has a volume of only 0.2cc, smaller than a soybean. A smaller volume means the optical engine itself is lighter. Furthermore, it optimizes the entire glasses structure. Whether it's Meta's Display or other products using LCoS solutions, their appearance and weight now more closely resemble regular eyewear. II. Stronger Battery Life Micro LED is very energy-efficient when displaying pure green, requiring only 10% of the LEDs to be lit. However, achieving full-color display necessitates lighting up 45% of the LEDs, increasing power consumption by over four times. For instance, a high-end product from a certain domestic brand, priced near ten thousand yuan, reportedly lasted only about 40 minutes under intensive reviewer testing, falling far short of daily usage requirements. In contrast, LCoS solutions offer better endurance. Meta's full-color glasses boast a battery life of 4 hours, while the Shanji S1, utilizing Appotronics Corporation Limited's "one-drives-two" optical engine solution, can achieve a single-charge battery life exceeding 15 hours. III. Clearer Display LCoS inherently supports high pixel density. Taking Appotronics Corporation Limited as an example, their most basic full-color optical engine方案 already achieves 960x720 resolution, with plans to quickly launch glasses featuring 1080P resolution soon. Overall, in the foreseeable future, the LCoS solution appears to be the阶段性 optimal choice. Given the continuous optimization of LCoS solutions, it's reasonable to conclude that the next few years are destined to be a boom period for AR glasses. With terminal volume shipments imminent, how should investors ride this favorable trend? // The AR Industry Chain: A Stabilizing Force in the Tech Sector The production chain for AR glasses is remarkably similar, if not identical, to that of smartphones and new energy vehicles, making their development历程 highly instructive. In the early stages of both these industries, the OEMs (Original Equipment Manufacturers) were often not the first to become profitable; instead, upstream players in the supply chain tended to fare better, enjoying stronger certainty. Consider BYD and CATL (Contemporary Amperex Technology Co. Limited). Whether during the smartphone boom or the current era dominated by new energy vehicles, these supply chain giants have remained indispensable. Tianyancha APP data shows that both have been on a relentless high-growth trajectory since 2015. In comparison, the growth rates of OEMs like Xiaomi, OPPO, and Nio/Li Auto/Xpeng appear modest. Of course, the supply chain also requires high certainty. Components like batteries, lenses, chips, and screens for phones, or motors, batteries, and tires for cars, are essential needs that remain constant for many years, and the underlying technologies can be reused. Thus, while the tech industry is constantly evolving, a significant number of supply chain enterprises have remained steadfast, some even aiming to become centennial companies. Conversely, OEMs, facing fierce market competition, have seen significant turnover. The same logic applies to AR glasses. Among the key components—optical engines, lenses, batteries, and chips—the optical engine deserves the most attention due to its high cost proportion and substantial profit margin. More critically, it also involves high technical barriers. Take Appotronics Corporation Limited, for instance. Having been rooted in laser display technology for over a decade, its position in the supply chain wasn't achieved overnight. It stemmed from a strategy set at the time of its IPO, long before AR glasses reached their current level of popularity. As an analogy, if the race in this sector is 10 kilometers long, many supply chain companies, including Appotronics Corporation Limited, have already gotten a "head start," potentially covering three or four kilometers already. For example, addressing the challenging speckle issue in "laser + LCoS" solutions is a core competency for Appotronics Corporation Limited. This advantage stems from over a decade of积累 in semiconductor laser source technology, making it exceedingly difficult for latecomers to catch up from scratch. On the commercialization front, Appotronics Corporation Limited has already secured partnerships with multiple brands. Positive market reception will likely lead to stronger economies of scale. Naturally, future challenges for tech suppliers like Appotronics Corporation Limited include managing capacity pressure, yield rates, and the customized needs of different OEMs, requiring close monitoring of their product performance and commercialization progress. Finally, for investors, the fervent AR glasses赛道 presents an incremental market with a defined technology路线 and high concentration. Amid the volatility of the secondary market, it might represent a compelling opportunity. In the real world, we also anticipate that with continuous technological iteration from supply chain leaders like Appotronics Corporation Limited, AR glasses will accelerate their普及, heralding the earlier arrival of a smarter era of new hardware. Disclaimer: This article provides commentary based on legally disclosed company information and publicly available data, but the author does not guarantee the completeness or timeliness of such information. Additionally: The stock market involves risks; investment requires caution. This article does not constitute investment advice; investment decisions must be made based on individual discernment.
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