Newly Listed Stock Preview | AR Glasses Leading Company XREAL: Accumulated losses exceed 2 billion in 3 years, the thirst for funds is hard to hide even as a "double champion" in the field.

With the deep integration of the digital economy and artificial intelligence technology, AR, as the next-generation core entry point for human-computer interaction, is entering a period of explosive development. Among them, consumer-grade AR glasses, with their lightweight and scenario-based product attributes, have become the core carrier for the landing of AR technology in the civilian market, with the global market size steadily increasing and capital attention continuing to rise. In this race, XREAL (formerly "Nreal") has firmly held the top spot in global AR glasses sales revenue for four consecutive years through continuous technological innovation and global expansion, becoming a well-recognized leader in the industry. In early April of this year, XREAL formally submitted an application for listing on the Hong Kong Stock Exchange and plans to list on the main board. Once successfully listed, the company is poised to become the "number one stock in global smart glasses." However, beneath the glamorous market position, the financial pressure of this leading AR glasses company is increasingly growing - although XREAL's revenue has been steadily increasing, it has actually accumulated over 2 billion yuan in losses in the past three years, with cash flow continuing to be under pressure, caught in a growth dilemma of "selling more but losing more." So, behind this contrast, what is the investment value of XREAL? Performance from both sides: Ranked first globally in sales vs. accumulated losses exceeding 2 billion yuan in 3 years According to GMTEight, XREAL is a leading AR glasses company with a global consumer base. The company designs, develops, manufactures, and sells AR glasses under its own brand, as well as provides related products and services. In terms of sales revenue, XREAL has been ranked first in the global AR glasses market from 2022 to 2025. In 2025, with a revenue market share of 27.0% and a sales volume market share of 24.8%, XREAL led the global AR glasses market, making it a truly top company in the industry. The company launched its first commercially available AR glasses for consumers, the Light series, in 2019, followed by the NebulaOS which brought systemic spatial interaction capabilities to AR glasses, as well as establishing an AR optical module manufacturing factory and launching the X1 side co-processor. Currently, the product line can be categorized into three main series: the Air series, the One series, and the Light-Ultra-Aura product line. In terms of revenue, in recent years, as the global smart glasses market has accelerated its expansion, XREAL's revenue has continued to grow: from 390 million yuan in 2023 to 516 million yuan in 2025, with a year-on-year increase of 30.8% in 2025. It is worth noting that XREAL is currently still in the quagmire of losses, with losses of 882 million yuan, 709 million yuan, and 456 million yuan respectively from 2023 to 2025, resulting in accumulated losses exceeding 2 billion yuan over three years. Under long-term losses, the company's financial pressure is becoming increasingly evident. As of December 31, 2025, XREAL had only 63.63 million yuan in cash, and its operating cash flow has been negative for three consecutive years, with its blood-producing capability urgently needing verification. The company also warned of risks related to this in its prospectus, stating that "if positive cash flow cannot be generated from operating activities, it may adversely affect the company's ability to raise funds for business under reasonable conditions, and if it fails to maintain sufficient operating funds, it may have a significant adverse impact on the company's business, financial condition, operating performance and prospects." Fortunately, the significantly rising gross profit margin is revealing a positive signal of profit recovery for XREAL. According to the prospectus data, XREAL's gross profit margin has shown a "three-stage jump" in the past three years: from 18.8% in 2023 to 22.1% in 2024, and further soaring to 35.2% in 2025. This breakthrough is driven by two core factors: first, self-developed technology to reduce costs, by independently developing core components such as optical modules and side co-processors, reducing reliance on external supply chains and significantly compressing production costs; second, scale effects are evident, with the increase in sales of high-end One series products leading to a continuous decrease in unit production costs, combined with pricing advantages, achieving rapid expansion of gross profit margins. As profit-making capabilities continue to improve, XREAL's losses also continue to shrink: net losses decreased from 882 million yuan in 2023 to 456 million yuan in 2025, and adjusted net losses decreased from 437 million yuan to 250 million yuan. Combined with the continuous improvement of the gross profit margin and the trend of increased sales of high-end products, the market's expectations for XREAL's achieving profitability on a scale are also rising. Overall, despite XREAL's impressive achievement of being the global market leader in market share and revenue, along with the acceleration of revenue growth and a significant increase in the gross profit margin, XREAL has substantiated its leading position in the AR race. However, the reality of accumulated losses exceeding 2 billion yuan over three years, cash flow constraints, and the declining trend in research and development investment, also expose the harsh financial concerns behind this high growth. Furthermore, the industry, although with vast potential, is still in its early commercialization stage, with industry leaders and local competitors emerging, indicating that it will take time for the industry to truly take off. Therefore, the current investment value of XREAL essentially lies in a race between its "first-mover advantage" and "financial resilience": if it can leverage the momentum of improving gross profit margins to quickly surpass the breakeven point and continuously consolidate its technological and product moat with limited resources, it may seize the maximum dividends when the industry inflection point arrives. On the other hand, if research and development shrink and financial pressures erode core competitiveness, even if the racetrack heats up, it may still be difficult to escape the fate of falling behind. For investors, this is not only a scarce chip on a high-growth track but also a test of patience and risk preference.