Core Viewpoint - The upcoming Meta Connect conference, scheduled for September 17-18, is expected to showcase new AI glasses and software, highlighting the potential of augmented reality (AR) and artificial intelligence (AI) in the eyewear market [1] Group 1: Product Launches - Meta is anticipated to unveil the Celeste smart glasses, the third-generation RayBan-Meta glasses, and the Oakley sports glasses at the conference [1] - The event may also feature a new "metaverse software" that aims to redefine AI glasses from hardware, interaction, and software perspectives [1] Group 2: Industry Trends - Since the beginning of the year, domestic companies such as Xiaomi, Rokid, Thunderbird, and Xreal have launched AI/AR glasses, indicating a growing interest in this technology [1] - Major international companies like Google, Samsung, Apple, and Amazon are also clarifying their hardware and software plans for AI/AR glasses [1] Group 3: Market Outlook - The industry is viewed positively due to the enhancement of AI model capabilities, with glasses being seen as a long-term potential entry point for always-on interaction [1] - There is a recommendation to pay attention to the short-term catalysts that new product launches from leading companies may bring to the supply chain [1]

Core Insights - Morgan Stanley's report highlights the rapid integration of AR features by Chinese manufacturers like Alibaba, Rokid, and Xreal in the AI+AR glasses sector, predicting an 80% CAGR for the AI glasses SoC market from 2024 to 2028, with market sizes for CIS and LCOS expected to reach $273 million and $153 million respectively by 2028 [1][13][14] Group 1: Company Developments - Alibaba has launched the WOW Quark AI + AR glasses, utilizing a mainstream SoC and an additional BES2800 chip for enhanced energy efficiency, featuring dual micro-LEDs and a waveguide system [2][5] - Rokid's AI + AR glasses employ similar silicon components and also use micro-LEDs from Crystal Optoelectronics, equipped with four waveguides compared to Alibaba's two per eye [2][5] - Xreal has adopted a different approach by combining micro-OLEDs with a birdbath optical stack, which, while potentially heavier, offers full-color images [2][5] Group 2: Product Specifications - Meta's upcoming AR glasses, Celeste, are expected to be unveiled at the Meta Connect event in September, featuring a high-resolution silicon LCD panel with 58 pixels and a refresh rate of 120 Hz, along with a waveguide display module [3][4] - Battery life remains a critical issue, with early prototypes showing only 4 minutes of usage, making improvements in this area essential for user acceptance [3][4] Group 3: Industry Trends - The report indicates that the short-term adoption of silicon waveguides in AR displays is limited due to high costs, with a silicon wafer costing $5 supporting only 3-4 pairs of glasses [4] - The collaboration between Tianyue Advanced and Sunny Optical aims to advance the application of silicon carbide substrates in optical fields, which could benefit AI glasses and automotive displays [11] Group 4: Market Predictions - Morgan Stanley forecasts that the total addressable market for system-level chips in AI glasses will grow at an 80% CAGR from 2024 to 2028 [13] - By 2028, the total addressable market for image sensors in AI glasses is projected to reach $273 million, while the market for silicon LCDs in AR devices is expected to hit $153 million [14]

Core Insights - The report by Morgan Stanley highlights the rapid development of AI + AR glasses in the Greater China and Asia-Pacific regions, with companies like Alibaba, Rokid, and Xreal integrating AR functionalities using advanced technologies such as MicroLED and waveguide systems. Meta's new AR glasses, Celeste, will utilize LCOS display modules, with battery life being a critical consideration. The AI glasses SoC market is projected to grow at an 80% CAGR from 2024 to 2028, with the CIS and LCOS markets expected to reach $273 million and $153 million, respectively, by 2028 [1][17][22]. Company Developments - Alibaba has launched the WOW (哇哦) AI + AR glasses, which incorporate a mainstream system-on-chip (SoC) along with a BES2800 chip from Best Technology to enhance energy efficiency. The glasses utilize dual micro-LEDs and a waveguide system for AR functionality, featuring monochrome (green) micro-LED chips from Crystal Clear Optoelectronics [2][8]. - Rokid's AI + AR glasses employ similar silicon components and also use micro-LEDs from Crystal Clear Optoelectronics, equipped with four waveguides (two per eye) [2][8]. - Xreal has taken a different approach by combining micro-OLEDs with a birdbath optical stack, which, while potentially increasing weight, allows for full-color image display [3][8]. Meta's Product Launch - Meta's Celeste AI/AR glasses are expected to be officially launched at the Meta Connect event in September. The glasses will feature a high-resolution silicon LCD panel with 58 pixels and a refresh rate of 120 Hz, utilizing waveguide technology licensed from Lumus and manufactured by Schott. Battery life remains a significant challenge for user acceptance [4][5][6]. Market Trends and Projections - Morgan Stanley's research indicates that the short-term adoption of silicon waveguides in AR displays is limited due to high costs, with a $5 silicon wafer supporting only 3-4 pairs of glasses. The third-generation Ray-Ban Meta 3 is anticipated to enhance AI-driven multimodal features, including real-time object detection and environmental understanding, while retaining similar semiconductor solutions [7][8]. - The report also notes that the AI glasses market is expected to see significant growth, with a projected 80% CAGR for the SoC market from 2024 to 2028, and the total addressable market for image sensors in AI glasses estimated to reach $273 million by 2028 [17][19].

Group 1 - The core focus of the report is on the AI + AR glasses market in Greater China and the Asia-Pacific region, highlighting the rapid integration of AR features by Chinese manufacturers such as Alibaba, Rokid, and Xreal, utilizing technologies like MicroLED and waveguide systems [1][7] - Alibaba has launched the WOW glasses, which incorporate dual micro-LEDs and a waveguide system, while Meta's new AR glasses, Celeste, will use LCOS display modules with a critical emphasis on battery life [2][3] - Morgan Stanley predicts an 80% compound annual growth rate (CAGR) for the AI glasses SoC market from 2024 to 2028, with the CIS and LCOS market sizes expected to reach $273 million and $153 million respectively by 2028 [1][17][19] Group 2 - The WOW glasses from Alibaba utilize a mainstream system-on-chip (SoC) along with a BES2800 chip for enhanced energy efficiency, and they feature a monochrome micro-LED display [2][7] - Rokid's AI + AR glasses have a similar design to Alibaba's, using micro-LEDs and diffraction waveguides, while Xreal employs a different approach by combining micro-OLEDs with a birdbath optical stack for full-color display [2][15] - Meta's Celeste is expected to be officially launched at the Meta Connect event in September, featuring a high-resolution silicon LCD panel with a refresh rate of 120 Hz, although battery life remains a significant concern [3][4][5] Group 3 - The report indicates that the short-term adoption of silicon waveguides in AR displays is limited due to high costs, with a silicon wafer costing $5 supporting only 3-4 pairs of glasses [6] - The collaboration between Tianyue Advanced and Sunny Optical aims to promote the application of silicon carbide substrates in optical fields, which could benefit AI glasses and automotive displays [13] - Meta's Q2 2025 earnings call highlighted that AI glasses will be a primary means of integrating superintelligence into daily life, with a 5% year-over-year increase in Reality Labs revenue attributed to strong AI glasses sales [14]

Summary of Key Points from the Conference Call Industry Overview - The conference call focused on the **Greater China Semiconductors** industry, particularly the advancements in **AI and AR glasses** technology [1][4][7]. Core Company Insights - **Alibaba** has launched its **WOW Quark AI+AR glasses**, which utilize a binocular **MicroLED+waveguide system**. The glasses are powered by a mainstream SoC and include a **Bestech BES2800** for improved power efficiency. The MicroLED projector is supplied by **JBD**, featuring a monochrome (green) display [6][7]. - **Rokid** has introduced AI+AR glasses that share similar silicon components with Alibaba's WOW glasses, also using **JBD's MicroLED** technology but with four waveguides to serve both eyes [6][8]. - **Xreal** employs a different approach, utilizing **MicroOLED** technology with a birdbath optical stack, which, while potentially increasing weight, allows for full-color imagery [6][8]. Product Specifications and Technology - **Meta's new AR glasses**, named **Celeste**, are expected to be officially launched at the **Meta Connect Conference** in September. They will feature an **LCOS (Liquid Crystal on Silicon)** + waveguide display module, specifically using **Omnivision's OP03011** panel with a resolution of **648x648** at **120Hz** [2][6]. - A significant concern for AI+AR glasses remains **battery life**. The earlier Orion prototype had a limited runtime of **45 minutes**, and improvements in battery life for Celeste are deemed critical for user adoption [6][11]. Market Dynamics and Trends - The AI glasses market is experiencing rapid growth, with **Meta** reporting a **5% year-over-year increase** in Reality Labs revenue, driven by strong AI glasses sales despite a decline in Quest sales [11]. - The integration of **AR functions** in AI glasses is seen as a potential driver for future smart glasses products, enhancing user interaction with AI [11]. Supply Chain Developments - **SICC** and **Sunny OmniLight** have entered a strategic cooperation agreement to promote **SiC substrates** in the optical field, which could benefit the application of these materials in AI glasses and displays for electric vehicles [10]. Forecasts and Projections - The total addressable market (TAM) for **LCOS in AR devices** is projected to reach **US$153 million** by **2028** [18]. - The **CIS TAM** in AI glasses is expected to grow to **US$273 million** by **2028** [22]. - The **SoC TAM** for AI glasses is forecasted to have an **80% compound annual growth rate (CAGR)** from **2024 to 2028** [24]. Conclusion - The AI and AR glasses market is rapidly evolving, with significant advancements from major players like Alibaba, Rokid, and Meta. The integration of advanced display technologies and improvements in battery life are critical for the adoption and success of these products in the consumer market. The strategic partnerships and supply chain developments further indicate a robust growth trajectory for the industry.