[Editor’s note: This story was previously published in June 2019. It has since been updated and republished.]
Augmented reality is quietly growing quickly. According to a report released last year, AR was worth $350 million in 2018, and its value is expected to surge at a compound annual growth rate of around 150% from 2019-2024. Among the areas in which AR is expected to be used in the near-future are social media, mobile devices, virtual conference calls, and automotive devices.
Here’s a run-down of nine names investors will want to keep an eye on as the harbingers of the (fruitful and rapidly approaching) AR era.
Vuzix Corp (VUZI)
Although the project was actively pursued by Alphabet (NASDAQ:GOOGL) afterward, the first go-around for Google Glass was pretty much a flop. The idea of projecting information onto glass a user/wearer is looking through, however, never really went away. It just has far more applications as an industrial or commercial tool than it does for a consumer.
Enter Vuzix Corp (NASDAQ:VUZI). You may know it as the company that developed an apparatus that helps blind people get around better. But products like its M300 and Blade smart glasses were “built for enterprise.” The company has quietly made a compelling case for using them as a means of getting more done in the workplace at a reasonable price… for a corporation.
Yes, it’s best known as a telecom and semiconductor play and not often lumped in with a list of AR stocks. But, QUALCOMM, Inc. (NASDAQ:QCOM) is very well-positioned to capitalize on the mainstreaming of augmented reality.
It’s gone relatively unrealized (or at least unappreciated), but AR requires the delivery of massive amounts of data, and it requires plenty of computing power to deliver that information in real-time. AR glasses and goggles also burn through batteries relatively quickly.
QUALCOMM as addressing all three needs, announcing in 2018 that it would be developing a chipset specifically for AR and VR applications. This turn-key solution will make it easier for other developers to bring new glasses to the marketplace.
If the name Lumentum (NASDAQ:LITE) rings a bell, there’s a reason. It’s a stock that was thrust into the spotlight in the latter part of 2017 when Apple CEO Tim Cook began talking up augmented reality’s prospects.
Though he didn’t explicitly say at the time how (or even if) Apple would aim at the AR market, nor did he mention Lumentum by name, the potentially-bullish connection makes a lot of sense. Lumentum makes the kind of 3D sensor lasers that can turn a smartphone into something of a radar — an important piece of the augmented reality movement.
Speaking of Apple(NASDAQ:AAPL), it, too, is a name to keep in mind if you believe augmented reality is a serious opportunity.
Yes, its smartphones are powerful computers that seem to become more powerful with each iteration. That’s not why the company is such an interesting AR prospect though. Rather, Apple is reportedly developing its own augmented reality headset, a la Google Glass.
The device likely wouldn’t launch until 2021, according to Loup Ventures’ Gene Munster. But the market rewards potential about as much as it does real results, so it’s something that could begin to positively impact the stocks soon and continue as the presumed launch date nears.
Immersion Corporation (IMMR)
Immersion Corporation (NASDAQ:IMMR) has earned a spot on a list of noteworthy AR stocks to watch with its TouchSense(r) Force technology that makes displays screens a tactile, haptic experience. It’s been particularly impressive in the VR gaming world, but the possibilities are just now starting to be realized in full.
Axon Enterprise (AAXN)
Axon Enterprise Inc (NASDAQ:AAXN) isn’t an augmented reality play… yet. But, it appears it soon will be. In 2018, the maker of TASERs and body-worn cameras suggested AR and VR would be its next frontier.
It’s not entirely clear what this might mean. But, given the nature of its target markets — law enforcement and military personnel — it’s reasonably safe to assume the company is mulling ways to better protect and equip people that wear a uniform — and a gun — to work.
A marketable product is still years away, but like any other company, the market is likely to reward progress en route to results.
Microsoft Corporation (MSFT)
Don’t get the wrong idea. Productivity software, the cloud and operating systems are still the company’s break and butter, and will be for a long, long time. Microsoft Corporation (NASDAQ:MSFT) is wading into augmented reality waters, though, quickly enough that it just might make a modest impact on the stock’s value.
In May 2018, the software giant demonstrated two practical apps that make good use of the hardware: Layou, and Remote Assist. Layout allows for structural designing beyond mere blueprints, while Remote Assist shares what you see with people who aren’t on-site.
It may be just the ‘aha’ app that convinces companies they can’t live without the HoloLens.
For the record, Microvision, Inc. (NASDAQ:MVIS) and Microsoft are two different companies. The aforementioned Microsoft is the maker of the HoloLens, which may be on the verge of becoming a must-have. Microvision’s role in the augmented reality movement, however, it a little bit different. It’s the maker of laser (and the supporting technologies) that can project images and data into glass.
The most practical and tangible use of its PicoP(r) technology is the projection of the information normally found on a car’s dashboard up to the windshield, allowing a driver to keep his or her eyes on the road. It’s the same basic concept being used by Google Glass, Microsoft’s HoloLens and the like though — melding the benefits of a transparent material with valuable information overlaid.
Last but not least, it may be a tad obvious, but add NVIDIA Corporation (NASDAQ:NVDA) to your list of AR stocks to keep tabs on.
NVIDIA has already proven itself capable of handling the big visual data loads associated with virtual reality; making augmented reality even better is proving relatively easily by comparison.
One area it’s making that happen is on the automotive front. Like Microvision, NVIDIA is working on improving the driving experience by melding AR with artificial intelligence. That’s only a taste of what’s to come though. While other companies are still perfecting their first-generation augmented reality hardware, NVIDIA is already thinking about the next generation of AR technologies. Two improvements on NVIDIA’s radar are varifocal displays, which improve clarity of an object for a user, and the integration of tactile/haptic information with visually-augmented reality.
As of this writing, James Brumley did not hold a position in any of the aforementioned securities. You can follow him on Twitter, at @jbrumley.