Oura delayed its smart ring initial public offering on Tuesday, citing unspecified uncertainty in the IPO market, but the pullback signals deeper trouble for the AI wearables sector. The company had signaled strong product demand before the decision, prompting analyst skepticism about the stated reason.
The wearables market faces a credibility crisis rooted in privacy fears. Meta's Ray-Ban AI glasses, equipped with discreet cameras, have drawn social media condemnation as "pervert glasses" after users reported unauthorized recording on dates and in public spaces. A California court judge threatened contempt charges in February when people wearing Meta glasses appeared at CEO Mark Zuckerberg's testimony in a social media addiction trial. Meta released a camera-free glasses option last month but damage to consumer trust persists. DA Davidson analyst Gil Luria said the resistance to camera-equipped glasses is "done for at this moment" and predicted a decade-long reset before consumer acceptance returns. Luria noted his teenage sons were "super excited" about the glasses last year but now "wouldn't be caught dead in them."
The backlash extends beyond glasses. Smart glasses have been banned from gyms due to privacy concerns. License plate scanner company Flock Safety has seen its devices vandalized and lost municipal contracts over community opposition.
Apple, Google, Meta and OpenAI are all pursuing wearables as the potential next computing category. Apple showcased AI features on its Watch Series 12. OpenAI released its Dots personal assistant this week and is developing consumer hardware with iPhone designer Jony Ive. Meta introduced a Tamagotchi-like Muse Charm that topped Apple's app store free apps list.
Yet design failures have piled up. The Humane AI Pin sold for $700 but was discontinued after poor reviews due to overheating, sunlight visibility problems and weak battery life. The Rabbit r1 personal assistant lacked distinct advantages over smartphones and faced technical issues. Analyst Avi Greengart of market research firm Techsponential noted that flashy emerging AI wearables including pins and pendants have hit significant roadblocks.
Health-focused wearables show stronger market traction. Apple's AirPods now include accessibility features acting as hearing aids. Tracking features for sleep and exercise have proved valuable to consumers. But Nowroozi, the 24-year-old whose dating experience prompted caution about AI glasses, remains hesitant to enter the market.