Magic Leap somehow raised $500 million to make another AR headset

Magic Leap has raised $500 million in funding and is preparing to release a new AR headset, the Magic Leap 2, next year, the company announced Monday. The headset will be generally available next year, the company said, and “select customers” are using it as part of an early access program.

CEO Peggy Johnson said in a statement that with the new funding “Magic Leap will have greater financial flexibility and the resources needed to continue our growth trajectory as we expand on our industry AR technology.” She revealed the new device in an Monday appearance on CNBC.

Magic Leap, of course, is the company that began its existence as a mysterious AR startup, received almost $3 billion to fund its consumer-friendly AR headset, before changing its headset’s name from Magic Leap 1 to The Magic Leap One Creator Edition in an attempt to attract professional customers. The company laid off 1,000 employees — roughly half its workforce — in 2020, and was reportedly abandoning its consumer business. Cofounder and CEO Rony Abovitz left the company in July 2020, and was replaced by Johnson.

In April, Johnson said limited quantities of Magic Leap’s second-gen headset, 20 percent lighter and with a doubled field of view, would ship later this year. According to its statement Monday, the Magic Leap 2 will be the industry’s smallest and lightest device built for enterprise, “designed to increase business adoption of AR.”

In a separate post, Johnson reflected on her first year as Magic Leap’s CEO. She cited a “growing demand for AR” across industries, and cited research from International Data (IDC) that showed the AR/VR market is expected to grow to $140 billion by the end of 2024.

She listed the company’s enterprise customers, including Ericsson, and Farmers Insurance, the latter of which used the company’s tech to train new employees remotely during the pandemic. Johnson said Magic Leap has added strategic partnerships with Google Cloud, PTC, NVDIA, and VMWare

Johnson said Magic Leap’s core business is focused on enterprise solutions, but added “there continues to be intense interest in the application of Magic Leap’s technology in the consumer space. In fact, we have received several requests to license our technology and will actively pursue these opportunities if they enhance our position and ability to innovate in the enterprise market.”