Virtual Reality and Extended Reality (VR&XR) in Portugal 2026: trends, investment and opportunities for technology M&A
The latest report produced by Baker Tilly’s technology M&A advisers provides a comprehensive overview of the Extended Reality (XR) market in Portugal, updated to January 2026. This analysis is aimed at founders, executives, strategic investors and private equity funds seeking to understand the evolution of the XR sector from the perspective of acquisition and sale of technology companies.
The XR market encompasses virtual reality (VR), augmented reality (AR) and mixed reality (MR) technologies applied to the industrial, healthcare, education, tourism and entertainment sectors.
A distinction is made between:
- Consumer XR (gaming and entertainment)
- Enterprise XR (focus of the report): aimed at operational efficiency, industrial simulation and clinical applications
This final segment attracts the bulk of investor interest due to its capital-intensive nature, scalability and alignment with the European digitalisation strategy (Industry 4.0 and the Recovery and Resilience Plan).
Key trends in the XR market in Portugal for M&A advisers
The Portuguese XR market is evolving rapidly, creating significant opportunities for M&A experts in technology consolidation processes.
The industrial metaverse, AI and digital twins: at the heart of tech M&A
The convergence of XR, artificial intelligence and digital twins is redefining industrial efficiency. The most advanced companies have moved on from basic simulations to persistent environments that replicate operations in real time.
This is driving:
- Procesos de Acquisition processes for of technology companies specialising in industrial simulation
- Vertical integration by industrial and technology groups
- Increase in deals led by Technology M&A advisers
Sectors such as manufacturing, utilities and logistics are already using XR for operational optimisation and strategic resilience.
Tourism 4.0: XR applied to heritage and experiential tourism
The Duero Valley is positioning itself as a European hub for immersive tourism. Wineries and tour operators are incorporating XR to:
- Immersive experiences before, during and after the visit
- Reducing the impact of mass tourism
- Increasing conversion rates for in-person visits through telepresence
This segment is creating sales opportunities for technology companies in immersive experience start-ups and XR content platforms.
Healthcare XR: Regulation, Investment and Business Scaling
Portugal is renowned for its advanced digital health ecosystem. The VR Health Champions programme drives the development of medical XR technologies to regulatory standards (CE marking), accelerating their international scalability.
Companies such as Virtuleap and Sword Health are the kind of assets that attract:
- funds specialising in deep tech
- strategic investors
- advisors on the sale and purchase of technology companies
This sector is characterised by high regulatory barriers, significant capital inflows and considerable potential for technology-related M&A.
5G infrastructure: a driver of XR growth
5G coverage in Portugal enables the deployment of real-time XR applications with low latency.
This factor is key to:
- industrial adoption
- XR’s expansion into rural areas
- scalability of immersive platforms
Digital infrastructure is one of the main drivers of market growth and interest in acquiring technology companies.
Regulatory framework and attracting tech talent
Portugal has developed an attractive fiscal and regulatory environment for tech start-ups:
- tax optimisation for stock options
- incentives for highly skilled talent
- digital engineering retention programmes
This reduces the ‘brain drain’ and helps create attractive targets for technology technology M&A deals.
Consolidation of the XR ecosystem: the rise of tech M&A
The market is evolving from its early stages towards a phase of consolidation. Three key trends can be observed:
- strategic acquisitions by telecoms and IT companies
- vertical integration of XR and AI capabilities
- growth in cross-border M&A (particularly between the US and Portugal)
This context reinforces the role of M&A experts in structuring complex and cross-border transactions.
Analysis of investment in XR and M&A activity in Portugal
The Portuguese transaction market reached the following figures in 2025:
- 655 transactions
- €17.5 billion in capital raised
- 28% increase in value
There is a clear trend towards larger deals, which points to the maturing of the technology ecosystem. Private equity leads the way in investment activity, followed by venture capital and strategic acquisitions.
Significant transactions in technology M&A
Three main types of transactions stand out:
1. Vertical integration: consolidation of cloud, AI and XR capabilities by technology groups
2. Expansion of related capabilities: acquisition of biometric solutions, digital identity and immersive platforms
3. Consolidation in the healthtech sector: mergers to create integrated digital therapy and monitoring platforms
Transactions of this kind provide further work for Technology M&A advisers in due diligence and valuation processes.
Venture Capital and Corporate Venture Capital
The Corporate Venture Capital is gaining prominence as a strategic tool for:
- access to innovation
- integration risk mitigation
- acceleration of internal digitalisation
Portuguese XR start-ups continue to attract international investment, particularly in deep tech and digital health.
Opportunities for buying and selling technology companies in the XR sector
The XR market in Portugal offers clear opportunities for:
Acquisition of technology companies
- industrial simulation start-ups
- XR platforms for digital health
- immersive tourism solutions
Sale of technology companies
- companies in the scaling-up phase with proven technology
- companies with regulatory traction (healthtech XR)
- XR providers with ongoing industrial contracts
This environment is particularly relevant for funds and companies advised by M&A specialists during sector consolidation processes.
Perspectivas de crecimiento del mercado XR en Portugal
The XR market is projected to experience sustained growth, driven by rapid industrial adoption, the expansion of 5G infrastructure, significant public investment in digitalisation (PRR) and the consolidation of the start-up ecosystem.
- Base scenario: CAGR of 29%–32% until 2030
- Optimistic scenario: CAGR of 36%–41% with accelerated adoption of the industrial metaverse
- Conservative scenario: CAGR of 18%–22%, subject to hardware costs and corporate adoption
Key findings on the XR market in Portugal
The XR market in Portugal is entering a phase of rapid maturation, characterised by strong investment activity and increasing consolidation. This creates a particularly significant environment for:
- technology M&A deals
- international investors
- Private Equity funds
Los Technology M&A advisers play a key role in identifying targets, valuing companies and executing deals in this growing sector.
Tailor-made
Market Research on the Extended Reality (XR) Sector in Portugal in 2022
Read the full analysis by Baker Tilly Tech M&A and discover the leading companies in the sector, corporate transactions, funding rounds, technological trends and growth prospects for the Martech market in Spain.
