Augmented reality glasses: Snap's bet on post-smartphone future

What happened: Snap Inc. (NYSE: SNAP) unveiled its first pair of augmented reality glasses, 'Spectacles', priced at $2,195, significantly higher than competitors. The launch, after a decade-long development push, was met with criticism from investors and analysts, with Snap's stock falling by nearly 10% on the day of the announcement. Ross Gerber, an investor, questioned CEO Evan Spiegel's hardware strategy, while Guggenheim analyst Michael Morris estimated the glasses may have cost Snap up to $1,000 to develop. Despite the backlash, Spiegel defended the product as a long-term bet on the post-smartphone future.

Market impact: The AR glasses sector is impacted, with Snap's high-priced offering potentially limiting consumer demand. Snap's stock is down over 90% from its peak, reflecting investor concerns about the company's hardware strategy and financial performance. The broader tech sector is watching Snap's AR efforts, as other companies like Apple and Facebook (now Meta) also explore AR glasses.

What to watch next: Snap's Q2 2022 earnings report on July 22 will provide insights into the initial demand and sales of Spectacles. Additionally, any updates on Snap's AR strategy and potential partnerships at the upcoming Apple Worldwide Developers Conference (WWDC) in early June will be crucial, as Apple is also rumored to be working on AR glasses.