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21st Century Business Herald reporter Zhang Sainan and intern Yin Xinyu report from Shanghai

The AI ​​glasses sector began to pull back after a week of gains.

On August 19, the stock prices of companies that had previously soared in recent days, such as Xingxing Technology, Huacan Optoelectronics, Asia Optoelectronics, Bos Eyewear, and Wufang Optoelectronics, fell sharply. Despite the short-term correction in the market, the market's attention to AI glasses has not diminished at all. Many institutions believe that AI glasses are on the eve of an explosion.

"Smart glasses are highly portable and have a large user base. They can fully perceive the user's 'vision' and 'hearing' and have strong interactivity. In addition, the cooperation between smart glasses and high-end eyewear brands also gives them an additional social attribute and a cost-effective experience. They are expected to become one of the best terminals for the next generation of AI." said Geng Chen, chief analyst of the electronics group of Huachuang Securities.

The 21st Century Business Herald reporter noticed that on major social platforms, there are many sharing experiences about AI glasses, especially the Ray-Ban Meta smart glasses jointly created by Meta and Ray-Ban. Compared with the price of VR glasses, which cost tens of thousands of yuan, AI glasses are more affordable and easy to carry, and are recommended by many bloggers.

Can AI glasses replace VR glasses and become the next generation of hot-selling products in the consumer electronics industry? What are its business prospects and how far can this trend go?

AI glasses boom

Before AI glasses, VR glasses had been popular for a long time. Meta Quest, PICO, Vision Pro and others were released one after another, which always caused a stir in the capital market. Among them, Vision Pro was the most anticipated, but it did not really enter the general consumer market after its release. Its high price and uncomfortable wearing made consumers stay away.

The newly born concept of "AI glasses" solves the above problems. The focus is not on immersion, imaging and interaction, but on the application and integration of AI technology."(AI glasses) provide users with more intelligent services, such as real-time translation and health monitoring, while keeping the glasses light and portable.” Wang Peng, an associate researcher at the Beijing Academy of Social Sciences, told the 21st Century Business Herald reporter.

Take Ray-Ban Meta smart glasses as an example. The starting price is $299 and the appearance is similar to regular Ray-Ban sunglasses. In terms of AI experience, Meta AI is integrated into the glasses. Users only need to say "Hey Meta" to interact with Meta AI. Users can take photos and record videos through the glasses.

According to agency statistics, the global sales of Ray-Ban Meta smart glasses have exceeded 1 million units by May 2024. It is reported that Meta is expected to launch new AR glasses in September 2024.

The latest news from Apple has also helped to further boost the popularity of the concept of smart glasses. Technology journalist Mark Gurman recently said that Apple's Vision team, which focuses on AR technology, is continuing to experiment with and develop a number of products, including: an "affordable version of Vision Pro" planned to be launched next year, and a pair of smart glasses similar to Ray Ban Meta.

Domestically, many manufacturers are also accelerating the launch of smart glasses products, but no blockbuster has yet appeared. For example, in May this year, Huawei released the Huawei Smart Glasses 2 square-frame sunglasses equipped with the HarmonyOS 4 operating system, which is connected to the Huawei Pangu AI large model; in August, Honeycomb Technology launched the Jiehuan AI audio glasses. In addition, manufacturers such as Thunderbird, Yingmu Technology, and Meizu are expected to release smart glasses products in 2024.

"AI glasses, based on low cost, bring epoch-making high efficiency to consumers through AI technology, meeting the market demand for convenience and practicality of smart wearable devices. With the rapid development of AI technology, the core technology required for AI glasses has gradually matured, providing strong support for commercialization. In terms of application scenarios, AI glasses are not only suitable for people with vision correction, but may also become a fashionable incremental product, attracting a wider consumer group. In addition, it also shows great application potential in education, medical care, office and other fields." Wang Peng said.

According to the Betzers smart glasses market research report, the smart glasses market is showing strong growth momentum worldwide. Specifically, the global smart glasses market size will reach 39.473 billion yuan in 2023, and the Chinese smart glasses market size has exceeded tens of billions of yuan. It is expected that the global smart glasses market size will reach 106.778 billion yuan by 2029, with an average annual compound growth rate of 18.56% during the forecast period.

The industry chain responded eagerly

As the popularity of "AI glasses" continues to rise, investors have flocked to listed companies with related concepts to inquire about their layout, and many companies have publicly responded to whether they are involved in AI glasses-related businesses.

Among them, the most concerned is undoubtedly Doctor Eyewear, which has previously recorded "five consecutive boards". The company is a professional eyewear retail chain operation enterprise, and has established a stable cooperative relationship with smart eyewear brands Thunderbird Innovation, ROKID, and Meizu. Recently. It issued an unusual announcement stating that the company provides fitting services for smart eyewear lenses and has not yet involved the research and development of smart glasses. The operating income scale and proportion of the company's smart eyewear lens fitting services are extremely small, and will not have a significant impact on the company's business activities in the short term.

Among the components of smart glasses, accessories related to AI functions are key, so chip and optical suppliers have attracted attention, such as United Optoelectronics and BIWIN Storage.

United Optoelectronics said that it has accumulated core technologies for AR/VR related hardware products such as optical waveguides, Fresnel lenses, and pancakes. The company has the technical and production capabilities for smart glasses and has already supplied a small number of products, but the current business volume of this product is small and has limited impact on the company's performance.

BIWIN Storage publicly admitted that it provided ROM+RAM memory chips for the Ray-Ban Meta smart glasses. It said that the Ray-Ban Meta smart glasses series is equipped with Qualcomm's first-generation Snapdragon AR1 platform, which is specially designed and optimized for power consumption to limit heat dissipation in order to create lightweight smart glasses. The company's integrated R&D and packaging and testing layout has a strong competitive advantage in the field of smart wearables. It can optimize the firmware algorithm design in terms of low power consumption and fast response, while using advanced packaging and testing process capabilities to help products be thin and compact.

A person from the securities department of BIWIN Storage told a reporter from 21st Century Business Herald who called as an investor that the company's products have been used in smart watches and VR glasses of companies such as Meta, Google, and Xiaotiancai. "In the field of AI and smart glasses, we have indeed observed that such wearable devices are constantly developing and iterating. For smart wearable devices, their internal storage technology also needs to be continuously updated to meet demand. Because wearable devices are usually small in size and battery life is an important consideration, they have higher requirements for storage chips, including small size, low power consumption and high performance."

AI glasses manufacturers were also asked about their product sales. Pinming Technology launched the "Xiaoming AI Smart Glasses" in 2022. On the interactive platform, the company responded that the product combines AR glasses with AI algorithms to mainly solve the needs of on-site intelligent inspections and remote management of projects and enterprises. It includes AI violation identification, regulatory query, photo recording, remote guidance and other modules, which can be applied to construction site safety real-name management, enterprise remote observation, expert online guidance and other scenarios.

The company told reporters, “Judging from the overall sales situation, although this product has been launched for about two years, its share in the overall business is still relatively small."The company previously mentioned that the product is still in the early promotion and verification stage.

It is not difficult to find thatAmong the current A-share industry chain companies, AI glasses have not yet become a business that contributes significantly.

CITIC Securities research report pointed out that "in short-term investment, since the shipment volume of AI smart glasses is only in the millions, the corresponding performance elasticity of domestic suppliers is relatively low, so it is more inclined to thematic investment." However, in the long run, it believes that AI smart glasses, as wearable devices, bring epoch-making high efficiency to consumers at a low cost. It is currently recognized by the industry as the most cost-effective hardware implementation solution for AI, with huge potential. 2024 will be a turning point in the field of AI smart glasses.

Huaxin Securities Research Report also believes that 2024 will be the year of AI glasses development. On the enterprise side, Chinese and foreign companies are actively increasing their investment, and Meta, Apple, Microsoft, Rokid, Huawei, ByteDance, Xiaomi, XREAL, Thunderbird Innovation and other products have achieved initial results; from the application side, MR tends to 2B2C, and AI glasses tend to 2C, and the two are expected to complement each other in application scenarios. After AI glasses boost the consumer electronics sector, media applications are expected to take over, and you can pay attention to sports events, cultural science or entertainment.

From the perspective of industrial chain investment, based on the views of many institutions, it is generally believed that the core links include optical and display units, computing units, storage, batteries, sensors, assembly, etc. As a product of artificial intelligence landing on the terminal side, AI-related opportunities are in the industrial chain on the computing power side, including AI chips, optical modules, PCB, etc.

Although the market is cheering, there are different opinions in the industry regarding the commercialization of AI glasses.

Zhang Xiaorong, director of the Deep Technology Research Institute, told the 21st Century Business Herald that AI glasses are at most a conceptual product in the laboratory. "In terms of technology, current AI glasses have inherent deficiencies in terms of battery life, camera performance, and voice recognition accuracy. For example, battery life may limit the usage time; the camera shooting effect may not be ideal; and low voice recognition accuracy may affect the user experience."

He continued, "Even if the technical problems are solved, the safety hazards cannot be solved. For example, it may distract the user's attention and use certain functions while walking, crossing the road or driving, making it difficult to concentrate on the surrounding environment and causing traffic safety problems. In addition, some studies have shown that wearing some AI glasses for a long time may cause symptoms such as dizziness and headaches, affecting attention to people or things around them."