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Sure, look at a comparable "AR" company. Snap generated $150M in revenue last quarter, and is valued at $24B (market cap). Magic Leap would need to generate $5
by roymurdock 9y ago
Sure, look at a comparable "AR" company. Snap generated $150M in revenue last quarter, and is valued at $24B (market cap).
Magic Leap would need to generate $50M quarterly, or $200M annually to sit at a comparable valuation multiple. Given that they are working on an enterprise/industrial AR play (not selling ads to consumer like Snapchat), and that the enterprise/industrial AR market is in the $billions for yearly revenues, I think this valuation is totally feasible.
Facebook, Google, and Microsoft will play in the mix, but the market for industrial/enterprise AR will be big enough to sustain a few large players.
Obviously only time will tell as it's impossible to evaluate what Magic Leap is actually developing and selling at this point.
- AndrewKemendo 9y agoGiven that they are working on an enterprise/industrial AR play Where are you getting that from? Everything they are about is experiences for the home user in an entertainment context.
- roymurdock 9y agoInterested to see any lit that confirms which mkt they are targeting? No clear message from the company, just some demos of 3D simulated objects. Could be applied to any vertical mkt/industry at this point from what I can tell. My overall point is that the $8B valuation could be justified if they are targeting a large multi $B yearly revenue market.