Meta, the company that has lost more than $92 billion on virtual reality since 2020, has had the first clear images of its next headset leak out of its own software, less than two weeks before its annual Connect conference, VR researcher Luna said in a post on X on Thursday.
“First official visuals of Meta’s Project Phoenix, found in the HorizonOS Prescription Lens firmware package,” Luna wrote.
The images show a slim, glasses-style device with nose pads instead of a face cushion, sensors on the sides and undersides of the temples, and a cable running out of the left temple to a separate compute puck, Luna said in a report on UploadVR.
The device is codenamed Project Phoenix, but Meta has been using the term “VR Glasses” in some places, Luna said in a post on X yesterday. Previously, Meta referred to it as “device” or “headset.”
Hiding in a prescription lens app
The images showed up in Meta’s HorizonOS Prescription Lens app on Wednesday, Luna said on X, then the app was pulled shortly after, according to a follow-up post.
Luna, who goes by the handle @Lunayian on X, is a tech contributor at UploadVR, where their bio describes them as “a VR enthusiast and dataminer mainly specializing in insights related to the operating system powering Meta Quest devices.”
They have been reporting on Phoenix for most of a year. On January 1 they posted a sketch of the device based on development units they said they had seen, and quote-posted it this week.
Last month, they also published a long roundup of everything known about the device.
According to Luna, Phoenix is Meta’s premium, ultralight headset, and it is the successor to the Quest Pro. Instead of packing the battery and processor into the headset, Phoenix moves both into a puck that clips to the wearer’s waistband. The headset is designed to be used seated, without controllers, using eye tracking and hand tracking in a gaze-and-pinch scheme similar to Apple’s Vision Pro.
The field of view is narrower than on a traditional headset, at roughly 88 to 91 degrees diagonally, Luna said on X.
The Wall Street Journal has reported that the price target is under $1,000.
So does this mean that Meta is still bullish on VR? Or that it is in the process of moving what’s left of its VR portfolio a little closer to its AI and AR-focused glasses line?
Personally, I’m torn. On the one hand, I do want to see a VR headset so light and thin that it’s basically a pair of glasses that can also double as regular glasses or as AR and AI glasses. I already wear glasses, so this approach appeals to me.
However, if this is a way of backing out of the whole metaverse thing without admitting that it was a $92 billion mistake, then that doesn’t bode well for the future of the metaverse. Regardless of what I think about Meta as a company, and Mark Zuckerberg as a human — or possibly, a reptile wearing a human skin — having a big company in the space did help lend credence to the industry.
Meanwhile, I checked the agenda of the Meta Connect 2026 conference, which starts in two weeks.
“We’ll share the latest in VR, wearables, metaverse, and AI,” Meta said in its save-the-date post.
Having VR in first place is a good sign. And the conference agenda, which is split into four tracks, has VR as the first track listed, ahead of AI glasses, AI, and Horizon.
The VR track has five developer sessions, according to the agenda: a guide to building for both Meta VR and AI glasses, updates to the game engine SDKs, building Android apps for VR, building immersive experiences with WebXR, and “A practical guide to controller-free interaction.”
That last one is where Meta could go into detail about the new VR Glasses’ eye and hand tracking, Luna said in the UploadVR report.
The new Meta VR Glasses aren’t expected to ship this year. Meta pushed the launch back to the first half of 2027 last December, according to Business Insider, which cited an internal memo from Maher Saba, vice president of Meta’s Reality Labs Foundation. The delay was “going to give us a lot more breathing room to get this right,” Meta executives Gabriel Aul and Ryan Cairns said in a separate memo, according to the report.
Given all the bad news that we’ve seen about Meta’s VR projects recently, that’s not a good sign.
In March, Meta shut down Horizon Workrooms, stopped taking new Quest for Business customers, and closed three of its first-party VR studios, and announced it was pulling the VR version of Horizon Worlds before partially reversing course a few days later.
Meta’s Reality Labs lost $4.6 billion in the second quarter of this year on $431 million in revenue, according to Meta’s second quarter earnings report, on top of $4 billion in the first quarter. Add that to the $84 billion the division had lost through the end of 2025, and the running total since 2020 is now more than $92 billion.
Meta CTO Andrew Bosworth has said the company still has two headsets in the pipeline.
“I think it’s officially leaked we’ve got two devices on the roadmap that we’re super excited about coming out over the course of a period of time,” Bosworth said in an interview at Davos earlier this year.
The other device is Quest 4, a gaming-focused headset now expected in late 2027 or 2028.
Meanwhile, the VR headset market as a whole is shrinking. Global XR headwear shipments fell 39 percent in the first half of this year, to about 2 million units, and Meta’s share dropped to 48 percent from 71 percent a year earlier, according to a September 3 report from Omdia.
“Meta poured massive resources into headsets, but has struggled to replicate the breakout success of the Quest 2,” Omdia senior principal analyst George Jijiashvili said in the report. “The ongoing slump across the headset market reinforces that bulky headwear remains a tough sell beyond a core enthusiast base.”
Counterpoint Research had similar numbers. VR headset shipments fell 18 percent year over year in the second quarter, while AR glasses rose 138 percent, according to its September 8 report, which said Meta’s decision to raise Quest prices “added further pressure to an already cooling market.”
That’s a sharper decline than the 12 percent drop IDC forecast for 2025 when I last checked in on the numbers.
Meanwhile, AR and AI glasses are flying off the shelves.
Display-less smart glasses shipped more than 2 million units in the first quarter of this year, up 167 percent from a year earlier, and IDC expects nearly 14 million of them to ship in 2026 — compared to about 3 million mixed reality headsets, IDC consumer devices research director Jitesh Ubrani said in a June blog post.
Revenue from Ray-Ban and Oakley AI glasses nearly doubled in the second quarter, EssilorLuxottica, Meta’s manufacturing partner, said in its first-half earnings release.
And Omdia’s numbers show glasses going from 10 percent of all XR headwear in the first half of 2025 to 26 percent in the first half of this year.
“XR glasses are gaining momentum because consumers are increasingly willing to trade some immersion for less friction,” Omdia senior analyst Qiran Ju said in the report. “Lighter designs and familiar use cases such as video viewing and gaming are lowering the barriers to adoption.”
If you’re confused by the acronyms:
- AR is “augmented reality.” The glasses are mostly normal glass, and you can see the actual world through them, with small images or text overlaid on them. For example, you could have a cartoony Pokemon hiding under your actual desk, or navigation arrows showing you where to walk, or subtitles translating someone’s spoken words in real time.
- VR is “virtual reality.” You don’t see much of the real world, if at all, but are instead immersed in a virtual world. The real, physical world only shows up in occasional pass-through moments, such as glowing lines marking the edges of your furniture so you don’t walk into the coffee table or knock over the TV.
- MR is “mixed reality.” That’s some kind of combination of the two, and typically means that you have a VR headset with a camera on the front of it so it can “pass through” an image of the real world and project it on your glasses’ display screen.
- XR is “extended reality.” It’s a catch-all term for all of these different kinds of glasses.
And all of these now have AI bolted on, of course.
I’ve tried many of these devices. I’ve bought a few, manufacturers have sent me a ton of them to demo, and I’ve tried others at tech conferences.
So far, I haven’t been impressed with any of them. For movies, I already own a TV set. I don’t play games. And the glasses are pretty much useless for any real work, so I’m sticking with my two giant monitors and my actual Windows computer, keyboard, and mouse for the foreseeable future.
The new Meta VR Glasses, at a reported 110 grams — almost 4 ounces — with no face cushion, tethered to a puck, without controllers, at close to $1,000, from a company that just spent the year closing its own VR apps, is probably not the answer.
Not to mention the narrow field of view, the lack of killer apps, and, of course, the fact that it’s tied to a closed, proprietary platform with a problematic track record on safety. I’m not going to be shelling out my money for the first generation of these. Nor, probably, the second or third. But if they can show that a market exists for this form factor, that would be pretty encouraging and might inspire other developers and investors to get into the space and give us something we can actually use.
