In this article, we will take a look at how VR is transforming experiences globally while navigating through the 10 best virtual reality stocks to buy now.
Overview of the Global VR Market
Virtual Reality is a computer-generated simulation that allows users to interact with a three-dimensional environment. The four elements that characterize virtual reality and differentiate it from other technologies such as augmented reality and mixed reality are a 3D-simulated environment, immersion, sensory engagement, and realistic interactivity, as revealed by HP.
According to a report by Fortune Business Insights, the global virtual reality market size was valued at $25.11 billion in 2023 and is expected to grow from $32.64 billion in 2024 to $244.84 billion by 2032, at a compound annual growth rate of 28.6% during the forecast period (2024-2032).
Region-wise, North America is expected to dominate the global VR market over the forecast period. Another rapidly growing region is Asia Pacific with growth driven by the rising demand for immersive technologies in emerging economies. China, one of the major distributors of head-mounted VR devices and other hardware, is forecasted to have the highest market share in the region. Simultaneously, Europe is the early adopter of virtual solutions in the automotive industry and will be experiencing significant growth, with Germany and the UK as its leading markets.
How is Virtual Reality Transforming Today’s World?
The virtual reality devices used today have their foundation laid on the first head-mounted augmented reality display “The Sword of Damocles” which was introduced by Ivan Sutherland in 1968. While firms such as Sega and Nintendo developed VR gaming systems in the 1980s and 1990s, it was not until the 2010s that high-quality VR headsets boasting powerful graphics and motion-tracking technology came to the market.
While gaming has been driving the popularity of VR, the potential of the technology has been realized in a multitude of other industries. The American shipping company UPS committed to millions for the advanced training of its drivers, with the firm’s industry-leading training powered by the use of virtual reality in an industrial training environment. Before drivers operate an actual delivery vehicle, the company’s Driving Simulator provides realistic driving experiences.
Virtual reality and augmented reality have also penetrated the healthcare sector as they offer transformative opportunities for medical training, patient care, and therapeutic interventions. The treatment domains in which these technologies are used to treat patients are diverse and include pediatric diagnostics and treatments, pain management, mental health, neurological disorders, surgery planning, intraoperative procedures, telemedicine, as well as post-operative and other rehabilitation therapies. The penetration is evident from the fact that the US FDA has authorized 69 medical devices that incorporate augmented reality and virtual reality.
Virtual Reality is also changing the game for the entertainment industry, especially for artists. Fortnite witnessed a record turnout of more than 12 million attendees to its virtual concert featuring the hip-hop superstar Travis Scott in 2020. Therefore, VR applications continue to spread around today’s world. The renowned luxury car manufacturer BMW has materialized virtual reality experiences in the automotive space. The company expanded its revolutionary driving experience with BMW M Mixed Reality which tends to blur the boundaries between the physical and virtual worlds through state-of-the-art VR/MR technologies.
With that being said, let’ move to the 10 best virtual reality stocks to buy now.
Our Methodology:
In order to compile a list of the 10 best virtual reality stocks to buy now, we utilized stock screeners, ETFs, and online rankings to make an extended list of the relevant companies with the highest market caps. Moving on, we shortlisted the top 10 stocks from our list which had the highest number of hedge fund holders. The 10 best virtual reality stocks to buy now have been arranged in ascending order of their hedge fund holders, as of Q2 2024.
At Insider Monkey we are obsessed with the stocks that hedge funds pile into. The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
10 Best Virtual Reality Stocks To Buy Now
10. Matterport, Inc. (NASDAQ:MTTR)
Number of Hedge Fund Holders: 25
Matterport, Inc. (NASDAQ:MTTR) is a leading spatial data company that focuses on digitizing the built world. The firm’s groundbreaking spatial data platform turns buildings into data to make almost every space more valuable and accessible. Buildings in over 177 countries have been transformed into immersive Matterport digital twins to improve every aspect of the building lifecycle from planning, construction, and operations to documentation, appraisal, and marketing. The firm is headquartered in Sunnyvale, California.
The firm is a clear market leader with its groundbreaking digital twin technology with unrivaled AI and deep learning. Matterport, Inc. (NASDAQ:MTTR) boasts a first-mover advantage with a robust patent portfolio. It benefits from a strong global adoption in diverse industries with numerous upsell opportunities. Leading customers including Redfin, Vacasa, and Cushman & Wakefield have chosen Matterport to help transform their businesses.
While the firm is driving the adoption of Matterport digital twin and witnessing growth, it is shaping a future where digital transformation empowers its customers and redefines the built world as emphasized by JD Fay, Chief Financial Officer. Matterport powers one of the biggest libraries of VR experiences of real-world places. Matterport for Mobile makes it easy and cost-effective to convert any space into an immersive 3D digital twin. The firm allows anyone to create 3D content for VR and its powerful cloud processing converts what the user has captured into a 3D space fully explorable in virtual reality. Matterport for Mobile is compatible with certain iOS devices, Android devices, and selected tablets.
Matterport, Inc. (NASDAQ:MTTR) closed a good second quarter of 2024 with annualized Recurring Revenue hitting a record $96.6 million, up 16% year-over-year. Subscription revenue which accounted for over 57% of the total revenue increased by 16% year-over-year and reached a record $24.2 million. Total subscribers grew to 1.06 million, up 28% year-over-year.
Hence, Matterport, Inc. (NASDAQ:MTTR) continues to redefine spaces by improving the way people understand and interact with the physical world. With a large library of real-world places captured for virtual reality, the firm ranks among the 10 best VR stocks to invest in.
9. Universal Display Corporation (NASDAQ: OLED)
Number of Hedge Fund Holders: 27
Universal Display Corporation (NASDAQ:OLED) serves as a world leader in the invention, research, development, and commercialization of state-of-the-art OLED (organic light-emitting diodes) technologies and materials. The company has grown from an R&D start-up to a global leader in the OLED industry. It licenses its proprietary OLED technologies to manufacturers of products for display applications including mobile phones, wearables, tablets, notebooks and televisions, and specialty and general lighting products.
While displays are essential for various consumer electronics products, OLED technology powers the VR products of today. The firm’s proprietary technologies and materials can be found in virtually every commercial OLED product, ranging from smartwatches and tablets to smartphones and TVs, including Samsung’s Galaxy series and LG’s OLED TVs. OLED technology is also used in Sony’s PlayStation VR2 as well as Apple Vision Pro.
On October 30, Universal Display Corporation (NASDAQ:OLED) reported its third quarter 2024 financial results. Total revenue was $161.6 million as compared to $141.1 million in the prior-year quarter. While the revenue from royalty and license fees grew over the year, revenue from material sales declined due to changes in customer mix as material volumes were relatively flat between periods. Overall, the management sees 2024 as the start of a new OLED adoption cycle for medium-sized displays, especially IT and automotive.
Universal Display Corporation (NASDAQ:OLED) has a leading position in the OLED ecosystem with unparalleled expertise and a global footprint. The firm currently owns, exclusively licenses, or has the sole right to sublicense over 6,000 patents issued and pending across the world. While the VR market is expected to expand in the coming years, the firm has a strong growth trajectory to pursue.
8. Sony Group Corporation (NYSE:SONY)
Number of Hedge Fund Holders: 29
Sony Group Corporation (NYSE:SONY) is a Japanese multinational conglomerate known for various products across different segments. The Sony Group comprises segments including Game & Network Services, Music, Pictures, Entertainment Technology & Services (Mobile Communications/Imaging Products & Solutions/Home Entertainment & Sound), Imaging & Sensing Solutions, Financial Services, and All Other businesses.
Sony is a pioneer in virtual reality. The firm has introduced one of the most popular VR headsets of all time, the PlayStation VR (PSVR), which was launched in October 2016. In 2023, Sony Interactive Entertainment announced the global launch of its next-generation virtual reality headset, PlayStation VR2 which was considered a big improvement to the original PSVR. In January, the company unveiled a new spatial content creation-focused mixed reality headset which was planned to be made available later in 2024.
For the fiscal second quarter ended September 30, Sony Group Corporation (NYSE:SONY) posted a strong performance. The firm recorded net income attributable to its stockholders of 338.50 billion yen as compared to 200.11 billion yen in the prior-year quarter, a solid increase of 69%. Sales grew by 3% year-over-year, driven by significant increases in I&SS (Imaging & Sensing Solutions) and G&NS (Game & Network Services) segments sales as well as rises in the Music and ET&S (Entertainment, Technology & Services) segments sales, while Financial Services and Pictures segments sales declined.
Sony Group Corporation (NYSE:SONY) ranks among the best VR stocks to buy based on its leading position among the top VR headset makers. As of Q2, the stock is held by 29 hedge funds.
7. Unity Software Inc. (NYSE:U)
Number of Hedge Fund Holders: 34
Unity Software Inc. (NYSE:U) is the world’s leading platform for creating and operating interactive, real-time 3D (RT3D) content. Its products give content creators the tools to create innovative RT3D experiences and deliver better processes for almost every industry. It operates in more than 45 locations globally.
Unity’s platform offers a set of software solutions to create, run, and monetize interactive, real-time 2D and 3D content for mobile phones, tablets, PCs, consoles, and augmented and virtual reality devices. The firm has a profound role in the Virtual Reality space with more than 60% of top-grossing VR Steam experiences in 2023 made with Unity. Unity’s ecosystem of tools and services can help develop good VR experiences. More than 50% of week one Must Play Apple Arcade Games for Vision Pro as well as 2 out of 3 of the most popular Quest experiences were made with Unity. Similarly, over 70% of top-selling Quest games are made with Unity. Back in 2023, Unity’s stock soared after Apple announced that Unity’s gaming software would be used in Apple Vision Pro.
The overall market opportunity for Unity is vast. As mentioned by the CEO in the Q2 2024 Shareholder Letter, Unity has provided vital tools and technology to a mobile gaming market that is 22% larger than it was in 2019. Mobile gaming accounts for 60% of the roughly $130 billion of consumer app spending annually while 70% of the top mobile games globally are built on Unity.
The company has set the foundation for its next phase of growth with Unity 6 which has been designed to be the most stable and high-performing version of Unity the firm has ever shipped and empowers developers with faster rendering and lighting capabilities as well as deeper support for growing platforms like mobile web and spatial computing.
Since the firm allows developers to create immersive VR experiences, Unity Software Inc. (NYSE:U) is an attractive VR stock that will potentially benefit from the growing Virtual Reality market.
6. QUALCOMM Incorporated (NASDAQ:QCOM)
Number of Hedge Fund Holders: 100
QUALCOMM Incorporated (NASDAQ:QCOM) is a global technology leader that helps to bring intelligent computing everywhere through the development and commercialization of foundational technologies. The firm has three reportable segments and conducts business primarily through its QCT (Qualcomm CDMA Technologies) semiconductor business and its QTL (Qualcomm Technology Licensing) licensing business. Meanwhile, the QSI (Qualcomm Strategic Initiatives) reportable segment makes strategic investments.
The firm is setting the stage for a new digital future through its virtual reality technologies which enable new realms of truly immersive user experiences. Qualcomm’s virtual reality solutions help original equipment manufacturers and developers introduce devices that include graphics with high pixel density, develop avatars with nuanced facial expressions, and immerse users with 3D spatial sound for clear voice interactions.
The Snapdragon VR products are the best VR chipsets from Qualcomm. The Snapdragon XR2 platform leverages AI, 5G, on-device processing, and edge cloud processing for photorealistic visuals and life-like responsiveness. The firm combines the compute power of the Snapdragon XR2 platform and top perception technologies to allow accessible and engaging learning, training, and entertainment VR experiences that seem real. Additionally, the company is making mobile VR a reality. By designing for the extreme requirements of fully immersive mobile VR, Qualcomm Technologies is in a unique position to deliver superior VR experiences. The firm’s solutions currently power many leading mobile VR solutions.
QUALCOMM Incorporated (NASDAQ:QCOM) closed the fiscal year with strong results in the fourth quarter. The firm witnessed a growth in EPS of over 30% year-over-year. The key segments performed well with QCT’s revenue up 18% and QTL’s revenue up 21%, year-over-year. Overall, the fiscal year 2024 results remained robust, marked by an over 20% EPS growth and a record free cash flow of $11.2 billion.
QUALCOMM Incorporated (NASDAQ:QCOM) is transforming the way we experience reality with its premium virtual reality offerings powering devices that are truly immersive and intelligent. As of Q2, the stock is held by 100 hedge funds and thus ranks on our list of the best VR stocks to invest in.
5. Advanced Micro Devices, Inc. (NASDAQ:AMD)
Number of Hedge Fund Holders: 108
Advanced Micro Devices, Inc. (NASDAQ:AMD) serves as the high-performance and adaptive computing leader that came into being as a Silicon Valley startup in 1969. The firm operates through multiple segments including Data Center, Client, Gaming, and Embedded. AMD provides LiquidVR technology that enables realistic and advanced VR experiences through powerful processors and graphics.
For over 45 years, AMD has driven innovation in high-performance computing, graphics, and visualization technologies which serve as the building blocks for gaming, immersive platforms, and the data center. VR demands a high compute performance which AMD is ready to deliver. AMD has been providing chips that power immersive experiences in various AR and VR devices. The company powers Sony’s PlayStation 5 and Microsoft’s Series X|S game consoles.
The company also introduced the world’s most powerful platform for virtual reality, capable of both creating and consuming VR content. The company’s Radeon Pro Duo with its LiquidVR SDK is a platform aimed at all aspects of VR content creation, from entertainment to education, journalism, medicine, and cinema.
AMD recorded Q3 revenue of $6.8 billion, up 18% year-over-year. The revenue growth was driven by increased sales of EPYC and Instinct data center products and strong demand for Ryzen PC processors. While Record Data Center segment revenue of $3.5 billion was up 122% year-over-year, Client segment revenue was up 29% year-over-year. The management was pleased with the financial performance and sees the firm being on track to deliver record annual revenue for 2024 based on significant growth in its Data Center and Client segments.
The firm has a bright growth potential across its data center, client and embedded businesses driven by the demand for more compute. As of Q2, Advanced Micro Devices, Inc. (NASDAQ:AMD) is held by 108 hedge funds.
4. NVIDIA Corporation (NASDAQ:NVDA)
Number of Hedge Fund Holders: 179
NVIDIA Corporation (NASDAQ:NVDA) is a designer of graphics processing units (GPUs) for PCs and game consoles. Considering that VR is one of the most demanding PC applications and requires the world’s most powerful GPUs, the ultimate VR experience can be enjoyed with a desktop or laptop PC powered by the GeForce RTX GPUs from NVIDIA. GeForce RTX GPUs offer plug-and-play compatibility with all of the top VR headsets.
Furthermore, NVIDIA has created VRWorks which is a suite of APIs, libraries, and engines enabling application and headset developers to create amazing virtual reality experiences. VRWorks offers many benefits such as enhancing advanced VR performance by increasing application rendering efficiency and image quality, easy integration as well as unlimited configurability.
For the second quarter of fiscal 2025, NVIDIA Corporation (NASDAQ:NVDA) posted record quarterly revenue of $30.0 billion, up 122% as compared to the one year ago. GAAP earnings per diluted share were up 168% year-over-year. Meanwhile, the firm witnessed record Data Center revenue of $26.3 billion, up 154% as compared to the prior-year period. While the Hopper demand remained strong, the new Blackwell GPU was highly anticipated.
Therefore, NVIDIA Corporation (NASDAQ:NVDA) is poised to grow considering its best in the business virtual reality GPUs and the demanding nature of Virtual Reality. As of Q2, the stock is held by 179 hedge funds.
3. Apple Inc. (NASDAQ:AAPL)
Number of Hedge Fund Holders: 184
The tech giant Apple Inc. (NASDAQ:AAPL) leads the world in innovation with the iPhone, iPad, Mac, AirPods, Apple Watch, and Apple Vision Pro. While the firm is well-reputed for multiple smart devices, it made its entry into VR with the launch of its revolutionary Vision Pro headset at its annual WWDC event in June 2023. Apple Vision Pro extends the experience of one’s go‑to apps and creates new possibilities in entertainment, productivity, gaming, and more.
Apple Vision Pro marked a major development in the VR world as emphasized by top industry executives. The CEO of Taiwanese tech giant HTC Cher Wang saw Apple’s aforementioned move as a validation for the industry and something that would bring more confidence in the global market for VR. Simultaneously, the chief technology officer of Finnish mixed reality startup Varjo Urho Konttori stated:
“Apple’s entrance into XR with Vision Pro is an important moment for our whole industry”
Recently, rumors have revealed that the tech giant is working on an affordable version of Vision Pro mixed reality headset. Apple analyst Ming-Chi Kuo claimed that Apple has delayed the production of the cheaper Vision Pro to beyond 2027. However, Apple is reportedly working on an updated version of the Vision Pro with an upgraded M5 processor to be launched in 2025.
For its fiscal 2024 fourth quarter ended September 28, Apple Inc. (NASDAQ:AAPL) reported revenue of $94.9 billion, a record September quarter revenue driven by iPhone. Apple CEO Tim Cook told CNBC’s Steve Kovach that the sales of the iPhone 15 were stronger than 14 in the year-ago quarter and 16 was stronger than 15. Additionally, Apple’s active installed base of devices reached a new all-time high across all products and all geographic segments. During the quarter, the firm was excited to announce the all-new iPhone 16 lineup, Apple Watch Series 10, and AirPods 4.
Apple Inc. (NASDAQ:AAPL) is a leading VR stock held by 184 hedge funds, as of Q2. The firm has been leading the way in innovation with strong fundamentals and material results.
2. Meta Platforms, Inc. (NASDAQ:META)
Number of Hedge Fund Holders: 219
Meta Platforms, Inc. (NASDAQ:META) is an American multinational technology conglomerate behind social apps such as Facebook, Instagram, and WhatsApp. The company has moved beyond 2D screens toward immersive experiences such as augmented, virtual, and mixed reality to enable the next evolution in social technology. The firm has two reportable segments including the ‘Family of Apps’ encompassing Facebook, Instagram, Messenger, WhatsApp, and other services, and the ‘Reality Labs’ which includes its virtual, augmented, and mixed reality-related consumer hardware, software, and content.
Meta has made significant progress in Virtual and Augmented Reality. Meta Quest enables people to get together with friends or meet new ones in VR. The most recent virtual reality headset Meta Quest 3S is an unreal device with an unreal price. It has been referred to as the new VR headset to buy for a large chunk of people and one of the best gateways into VR yet. It surpasses the Quest 2 by having 2x faster GPU processing power and the same mixed reality experience with 4.5x the resolution and color.
Meta Platforms, Inc. (NASDAQ:META) closed a good third quarter driven by AI progress across its apps and business. Total revenue was $40.59 billion, up 19% year-over-year. The firm is witnessing rapid adoption of Meta AI and Llama, which is rapidly becoming a standard across the industry. Meta also achieved milestones relevant to Reality Labs and the integration of AI and wearables. These include experiencing a strong demand for Ray-Ban Meta glasses, the introduction of its first full holographic AR glasses Orion, and the release of its newest Quest 3S.
With a strong product and business momentum as well as Meta’s revolutionary technology from virtual and mixed reality to social experiences, the firm is a promising virtual reality stock to buy now. As of 2024’s second quarter, Meta Platforms, Inc. (NASDAQ:META) is held by 219 hedge funds.
1. Microsoft Corporation (NASDAQ:MSFT)
Number of Hedge Fund Holders: 279
The renowned technology company Microsoft Corporation (NASDAQ:MSFT) empowers people and organizations to achieve more with technology. The company has segments namely Productivity and Business Processes, Intelligent Cloud, and More Personal Computing. Microsoft sells its products through OEMs, distributors, and resellers as well as directly through digital marketplaces, online, and retail stores.
Microsoft is an important player in the VR space. The company focuses on enterprises with its HoloLens device, an ergonomic, untethered self-contained holographic device with enterprise-ready applications to increase user accuracy and output. HoloLens 2 combined with software solutions is a hands-free computer that goes where one goes, sees what one sees, and does what one says. It enables acting with precision and working together with those who are remote on a holographic canvas overlayed in one’s physical environment. HoloLens 2 has diverse applications in industries including manufacturing, education, and healthcare.
Additionally, Microsoft Mesh is a platform for creating and sharing immersive 3D spaces for realistic virtual connections. Mesh encompasses an avatar system, spatial audio, virtual event production tools, and synchronizes experiences and interactivity across users on PC and VR. Leading companies such as Accenture are using Microsoft Mesh to expand its digital campus, One Accenture Park, to elevate onboarding and train new employees globally while PwC is bringing employees together to strengthen the company culture with immersive wellness experiences, such as guided and self-led tours and orientations.
For the FY25 Q1, Microsoft Corporation (NASDAQ:MSFT) recorded revenue of $65.6 billion, up 16% year-over-year. The firm witnessed a solid start to its fiscal year, driven by the continued strength of the Microsoft Cloud, which surpassed $38.9 billion in revenue. The segments remained robust. Revenue in Productivity and Business Processes was up 12%, revenue in Intelligent Cloud increased 20%, and revenue in More Personal Computing climbed 17%, year-over-year. Simultaneously, the firm’s AI business is on track to surpass an annual revenue run rate of $10 billion next quarter which will mark it as the fastest business in MSFT’s history to hit this milestone.
Thus, the growth opportunities for Microsoft Corporation (NASDAQ:MSFT) to look forward to are vast. The company can potentially continue enabling immersive experiences which are experiencing rising attention in today’s ever-evolving and innovating world. The stock is held by 279 hedge funds, as of 2024’s second quarter.
While we acknowledge the potential of MSFT as an investment, our conviction lies in the belief that some deeply undervalued AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for a deeply undervalued AI stock that is more promising than MSFT but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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