Meta seeks to double production of Ray-Ban glasses after increased demand

Meta Platforms Inc. and EssilorLuxottica SA are exploring the possibility of doubling production capacity for AI-powered smart glasses by the end of this year, in a bid to capture growing demand and fend off rivals, according to people familiar with the matter.

With sales of Ray-Ban Meta frames taking hold, Facebook owner Meta has suggested increasing annual capacity to 20 million units or more by the end of 2026, said the people, who asked not to be identified because the deliberations are private.

The partners have also discussed going further to establish the capacity to produce more than 30 million units, if demand warrants such a move, the people said. They warned that no decisions have been made.

The talks underscore Meta's desire to extend its AI strategy to hardware it can control end-to-end, reducing the tech giant's dependence on smartphones produced by its competitors. An increase in production would indicate confidence that smart glasses can surpass early adopters and reach mass-market scale.

EssilorLuxottica, responsible for manufacturing, is already close to its current capacity target of 10 million pairs by the end of 2026, one of the people said. The world's largest eyewear maker, with brands such as Ray-Ban and Oakley and retailers Sunglass Hut and LensCrafters, has a manufacturing footprint and customer reach that gives Meta a large-scale platform to expand its leadership in smart glasses.

Representatives for Meta and EssilorLuxottica declined to comment.

The production talks reflect a deepening relationship as Meta pivots toward smart glasses augmented reality and reduces its commitment to fully immersive virtual reality headsets. Last year, the technology company bought about a 3% stake in EssilorLuxottica, giving Meta closer access to EssilorLuxottica's manufacturing know-how and retail network.

The two companies began working together in 2019 and launched their first Ray-Ban-branded smart glasses in 2021. They have reported growing momentum in recent months, and EssilorLuxottica said in October that Meta smart glasses helped spur revenue growth in the third quarter.

In September, Meta introduced the latest $799 Meta Ray-Ban display in the US, which features text appearing directly on the right lens for the first time. At the CES show in Las Vegas last week, Meta said it had paused international expansion of the new frames to the United Kingdom, France, Italy and Canada due to “unprecedented demand and limited inventory.”

The news gave EssilorLuxottica shares a 5.2% boost on Jan. 6, following a 15% rise last year. Following Bloomberg's report on Tuesday, shares of Paris-based EssilorLuxottica reversed their losses and advanced as much as 2%. Meta fell 1% in the US.

The smart glasses market has attracted interest from global technology groups as advances in artificial intelligence, battery life and components make lighter, non-immersive wearable devices more practical.

Meta has the early lead with an estimated 73% global market share in the first half of 2025, according to Counterpoint. The researcher forecasts compound annual growth of more than 60% for the category through 2029. However, competition is increasing.

Last May, Alphabet Inc.'s Google formed a smart glasses partnership with the eyewear division of Gucci owner Kering SA, while Apple Inc. has redirected resources toward AI-powered glasses after reducing work on its Vision Pro headset. Chinese groups such as Xiaomi Corp. and Huawei Technologies have also launched smart glasses as companies test consumer demand for AI-enabled wearables.

Meta sees smart glasses as a key way to offer its AI services as it competes with tech heavyweights like Alphabet and OpenAI to dominate the next generation of technology.

The tech industry's push toward smart glasses fits with EssilorLuxottica CEO Francesco Milleri's strategy to expand into wearables and medical technology while preserving its dominance in traditional glasses, he said in an interview in October. He predicts that smart glasses could eventually replace smartphones.

However, a steeper production ramp would also create challenges for EssilorLuxottica as it balances growth with the cost of preparing its factories for the boost.

Ray-Ban Meta smart glasses are expected to generate substantially lower gross margins than EssilorLuxottica's broader line of products, according to analysts at RBC Capital Markets. Higher revenues and improving component costs will likely mitigate some of these strains as volume increases, they said.

Analysts are expected to ask EssilorLuxottica about its production plans with Meta when the Franco-Italian group reports its annual results in the first half of February.

The companies have closely guarded specific figures on Ray-Ban Meta sales: EssilorLuxottica executives said in February 2025 that they had shipped around 2 million units of Ray-Ban Meta frames since the end of 2023.

Chief Financial Officer Stefano Grassi said on a conference call in October that he expected to reach the 10 million-unit capacity target sooner than the original target of the end of 2026, without specifying further. He added that EssilorLuxottica has “the ability to do it in-house or outsource it.”