Global spending on virtual and augmented reality devices will balloon by 181% from $5.2bn (€4.65bn) this year to $162bn (€145bn) in 2020, according to new research by analysis firm IDC.
It also found that 50% of revenues during the period will come from AR and VR hardware.
Spending on software for the technology will grow 200% this year, IDC found, but revenue from services will overtake it around 2018.
Games and paid content will result in sales of VR systems being higher than AR related revenues this year and next, the Worldwide Semiannual Augmented and Virtual Reality Spending Guide said.
But beyond that, the research predicts that sales around AR will overtake VR equipment, as uptake of the technology in healthcare, product design and management-related applications grow.
Three quarters of the sales will come from Asia/Pacific (excluding Japan), the US and Western Europe, with the US likely to dominate the other regions by the end of the decade.
However, revenue in all the regions is likely to grow more than 100% during the 2015-2020 period, because the market is in its infancy.