Xreal targets commercial launch for its Aura smart glasses

Xreal, a partner of Google, is preparing to bring its Aura smart glasses to the commercial market later this year, aiming to carve out a space in a sector that has historically struggled to find profitability. The smart glasses industry has historically been a financial black hole with little profit, particularly within Silicon Valley, where investments have been sunk with little to no profit emerging. Chi Xu, the founder and CEO of the smart glasses company Xreal, discussed these financial challenges at Google’s I/O conference in Mountain View last week. “Everybody’s losing money,” Xu said.

Even players in the space continue to face financial hurdles. Meta’s partnership with Ray-Ban, which began in 2023, has successfully sold a significant number of units. However, Reality Labs, the division of Meta responsible for the smart glasses, still operates at a massive loss. Xu explained that the difficulty of the sector stems from the complexity of the work, noting that a company needs to have the hardware, the operating system, and a great user interface all ready at the same time to succeed.

To address these challenges, Xreal’s Project Aura focuses on functional XR, or Extended Reality, glasses. The Aura model features embedded OLED displays, but requires a connection to a puck—a phone-shaped mini-computer that powers the experience behind the glasses and can be carried in a pocket. The company claims this setup enables a seamless experience, whether users are following a floating recipe while cooking, setting up a private workspace in a coffee shop or on a flight, or watching a movie on a virtual big screen at home. Xu noted that the device is designed for both consumers and professionals, allowing users to perform tasks like working in a coffee shop rather than just watching an NBA game in a hologram format.

Currently available only to developers, the Aura glasses are scheduled for a commercial launch later this year. Looking ahead, Xreal is working on an IPO that is expected to occur before the end of 2026, though Xu declined to share further details. In the meantime, the company is focused on reaching profitability by raising its gross margins and reducing marketing and sales costs. According to Xu, next year is the year when the company could actually break even.

Why it matters

Xreal is attempting to transition the smart glasses industry from a financial black hole to a viable consumer market with its new Aura glasses, while simultaneously preparing for an IPO and targeting profitability by next year.