According to reports, Meta Platforms has invested in EssilorLuxottica, the largest eyewear manufacturer in the world, as the American tech behemoth makes even more commitments to metaverse and AI-powered smartglasses.
Separately, Reuters and Bloomberg News revealed that Meta had acquired a 3% share in the Ray-Ban eyewear manufacturer, valued at approximately $3.5 billion.
Both businesses did not immediately respond to messages left.
Following the announcement, shares of Franco-Italian EssilorLuxottica (FR:EL), which was created in a 2018 merger, surged 5% during Wednesday morning trading.
Before the specifics were made public on Wednesday, there had been a lot of speculation in the markets about a possible deal.
In the past, Meta (META) distributed its apps and services through rival-made smartphones or smartwatches, but this new collaboration with EssilorLuxottica gives the Mark Zuckerberg-led business the chance to develop its own hardware and manage its own distribution.
According to Precedence Research, smartglass sales surpassed $6 billion last year and are expected to reach $16 billion by 2034. In addition to taking pictures, listening to music and podcasts, making phone calls, texting, and receiving real-time translations, the latest iteration of the glasses allows users to livestream what they see straight into Facebook or Instagram.
Given Meta’s ambitious commitment to all things AI, analysts like the team at investment bank Jefferies believe “a further evolution of the relationship is possible” and that Meta may eventually increase its stake to 5%. EssilorLuxottica and Meta are leading the industry’s efforts in this new consumer wearable category.
“Meta’s stake just a first step?” a Jefferies note released Wednesday, suggests that the new agreement between the two businesses “gives Meta the advantage of having more detailed manufacturing knowledge and global distribution networks, fundamental to turning its smart glasses into mass-market products.”
Recent agreements like Google’s partnership with Kering’s (FR:KER) eyewear division and Gentle Monster, a South Korean eyeglasses producer, creating goods with Warby Parker (WRBY) are not the first of their kind in the industry.
The Chinese tech behemoth Xiaomi only joined the market this month, promising to compete with the second-generation Ray-Bans that Meta has been manufacturing with EssilorLuxottica for nearly two years.
Two million pairs have been sold during that period, and by the end of 2026, EssilorLuxottica intends to expand capacity to 10 million pairs. In June of this year, Meta and EssilorLuxottica introduced Oakley Meta, a new line of performance AI glasses for athletes, further broadening the selection. A similar effort with Prada to add a high-end brand to the portfolio is next on the conveyor belt, and other esteemed names are probably going to follow.
