In the era of AI, numerous scenarios are poised for reinvention.

In 2024, "wearable devices" emerged as the optimal hardware platform for AI applications on mobile terminals. Among the plethora of wearable options, AI glasses garnered the most attention. Following Ray-Ban Meta's validation of the AI glasses technology pathway, tech titans like Apple, Google, and Samsung also began investing in AI glasses. Domestically, Xiaomi, Huawei, Meizu, and other manufacturers have ventured into this exciting new sector.

Notably, the 2025 International Consumer Electronics Show (CES 2025) will take place in Las Vegas, USA, from January 7 to 10, local time. As an annual "tech Spring Festival Gala," CES has always been a pivotal platform for showcasing the latest technological achievements and innovative products.

With the continuous development of edge AI, AI glasses have surged in popularity. Market forecasts indicate that edge AI application innovations could be the highlight of CES, particularly in the realm of AI glasses, where a myriad of cutting-edge technologies and products are anticipated to be unveiled.

01. What Are AI Glasses, and What Are the Related Stocks?

AI glasses represent a novel type of wearable device. Functionally, they are primarily used for voice interaction and photography. Compared to previous mainstream glasses products like VR, the significant advancement in AI glasses lies in their enhanced user comfort. For instance, the highly anticipated second-generation AI glasses from Meta Ray-Ban weigh a mere 49g, less than one-tenth the weight of Meta's VR products. This makes AI glasses versatile for various daily scenarios, both indoors and outdoors, transcending the limitations of primarily indoor VR use.

The surge in AI glasses' popularity can be largely attributed to Meta and Ray-Ban's launch of their second-generation product, Meta Ray-Ban, last year, followed by the extensive integration of AI functions in April 2024, leading to a substantial increase in monthly active users. The latest monthly active user count witnessed a 25.2% increase from the previous month in July.

In terms of market potential, a research report by Zhongtai Securities suggests that the current stage of development in the AI smart glasses sector mirrors that of smartwatches in 2014, hinting at substantial growth potential in the future.

An analyst from Shenwan Hongyuan Securities believes that AI glasses, equipped with AI interaction and integrating the functionalities of headphones, cameras, and glasses, possess immense market potential despite being in their nascent stages. As products continue to evolve, becoming lighter and more affordable, the market for AI glasses could eventually rival that of traditional glasses or even smartphones in the long run.

According to another prediction by wellsennXR, starting from 2025, with the stable growth in traditional glasses sales, AI smart glasses will swiftly penetrate this market. By 2029, annual sales of AI smart glasses are projected to reach 55 million pairs. In essence, 2025 could be a pivotal year for the growth of AI glasses products.

Amidst this burgeoning market, the popularity of AI glasses has been on the rise since the second half of last year, with major manufacturers gearing up for a significant push.

Firstly, internet giants like Baidu and ByteDance, with their profound AI technology expertise and strong brand recognition, often launch AI glasses equipped with superior AI capabilities. Their brand influence facilitates consumer acceptance of these new products.

Secondly, smartphone manufacturers such as Huawei and Xiaomi, with deep accumulations in technology research and development, hardware manufacturing, brand influence, and supply chain management, are well-positioned to support their AI glasses business.

Regarding related stocks, Everbright Securities highlights that AI glasses represent one of the best application scenarios for edge AI. The emergence of popular products validates the product logic, and technology giants are actively deploying resources to continuously boost the AI glasses market. Everbright Securities recommends keeping an eye on:

(1) ODM and contract manufacturing: GoerTek (002241), Longcheer (603341), Jiahe Intelligence (300793), Yidao Information (001314), Tianjian Co., Ltd. (301383), etc.;

(2) SoC: Hivoice (688608), Actions (688049), Bluecom (688332), etc.;

(3) Other components: Fuliwang (688678), etc.;

(4) Channels: Boshi Eyewear (300622);

(5) Equipment: Bozhong Precision (688097).

02. Product Homogeneity: An Urgent Issue to Address

Despite the eagerness of various manufacturers to participate, product homogeneity remains an inevitable issue.

Firstly, based on the AI glasses already available, they can be broadly categorized into two types: those that integrate AI technology into eyewear, focusing on AI applications, and those that incorporate AI technology from an AR perspective to enrich eyewear functionality.

Examining specific functionalities, most manufacturers' AI glasses are modeled after or inspired by Meta, combining "audio," "camera," and "AR display" elements.

The root cause of the homogeneity in smart glasses might be attributed to fierce market competition and relatively low technical barriers, leading to similar product appearances and functionalities across manufacturers.

Some argue that AI glasses are not yet a rigid demand for consumers, primarily because the current AI glasses solutions offered by the supply chain fall short of consumers' expectations for the AI experience. There is ample room for improvement in photography, display modules, lightweight design, and chip performance for AI glasses.

Furthermore, price is a significant constraint on market penetration. Depending on their functionalities, domestic AI glasses range in price from 500 to 5000 yuan. Currently, several domestically released AI glasses are priced between 2000 and 3000 yuan.

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