XR Daily: Quest 3 Hits 240Hz

Quest 3 Just Unlocked a 240Hz Refresh Rate

Meta pushed out Horizon OS 2.7 this week, and buried in it is a genuinely surprising upgrade: the Quest 3 can now run its display up to 240Hz. Regular users get 207Hz at the headset’s full resolution, while 240Hz is reserved for developer mode, where the image is scaled down before being upscaled to the panel. The update affects only the Quest 3. The Quest 3S uses a different panel that tops out at 120Hz, and the Quest 2 is left out entirely.

Before you get excited, the practical ceiling is lower than the spec sheet suggests. Native Quest apps are almost never optimized for these framerates. 120Hz has technically been available since April 2021 and barely anything uses it. Application Spacewarp, the tool that lets developers double their FPS with synthetic frames, chokes beyond 120 FPS on the Quest 3’s SoC. Virtual Desktop developer Guy Godin has already shipped 144 FPS support, but he notes the video decoders struggle past that point, so higher framerates are probably not coming to wireless PC VR streaming.

The real takeaway is that Quest 3’s hardware was always more capable than Meta let on, and the company is now quietly unlocking it. Whether that is generosity or a nudge to flush stock as the headset ages, the headroom is real and developers now have room to experiment.

→ Road to VR

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Schell Games Lays Off 10 Percent of Staff, Its First Layoff in 24 Years

Schell Games, the veteran VR studio behind I Expect You to Die and Among Us 3D, has laid off roughly 10 percent of its staff, leaving about 125 people. CEO Jesse Schell confirmed the cuts in a statement, framing them as a rebalancing: the studio is moving away from a small number of large titles toward a greater number of smaller projects, a shift that requires a different mix of team members.

This one stings because Schell has spent two decades publicly refusing to lay people off. As recently as 2024 he told GamesIndustry.Biz that the studio would put cash at risk before jobs. The context makes the numbers clearer. VR was once 80 percent of the studio’s work and now sits around 30 percent. A new VR title is in production with more proposals on the table, but the company is leaning harder into VR-adjacent work like interactive projection for location-based entertainment.

It is the same story the rest of the industry keeps telling: consumer VR alone is not sustaining the studios that built it, and everyone is diversifying to survive.

→ Road to VR

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Meta Is Splitting Horizon Worlds Into Its Own App, Codenamed Eclipse

Dataminers have found assets in the August builds of the Meta Horizon mobile app that point to a full spin-off of Horizon Worlds into a standalone app, internally codenamed Eclipse with a likely public name of Horizon Create. Strings added in the August 25 update tell users they will need to migrate to access mobile game Worlds.

This is the clearest separation yet between Horizon Worlds and VR. Back in March, after far-reaching layoffs across Reality Labs, Meta announced it would drop Horizon Worlds from its VR devices and go mobile-only, then partially walked that back days later. Since then the company’s public comments have focused almost entirely on VR, and it even canceled planned GDC 2026 talks about Horizon Worlds.

The new app is described as a place to play, remix, and build mobile game Worlds with integrated AI tools, letting users personalize existing worlds or create new ones from a prompt. In effect, Meta is formalizing a split it has been drifting toward all year: VR on one side, mobile-first social Worlds on the other.

→ UploadVR

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Out-of-Home XR Is Quietly Becoming VR’s Next Revenue Engine

While consumer VR gaming searches for footing, the location-based entertainment (LBE) sector keeps building. In a guest piece for Road to VR, industry analyst Kevin Williams maps out how out-of-home XR has become a B2B2C model, deploying free-roaming VR and immersive attractions to audiences who would never buy a headset. Big IP holders are increasingly treating these attractions as revenue vehicles to reach new audiences.

The timing is not a coincidence. Schell Games’ pivot toward interactive projection for LBE is one data point, and the broader investment community has spent the last turbulent year hunting for the next profitable XR sector. LBE keeps coming up because it sidesteps the consumer market’s biggest problems: hardware cost, friction, and content droughts. The attractions are built, staffed, and refreshed by operators, while customers just show up.

Whether it can scale into something larger than a niche remains an open question, but the sector is clearly attracting money and IP that consumer VR currently is not.

→ Road to VR

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This Indie Studio Trained Its Own AI Model on Its Own Artists

Studio Atelico is taking a genuinely different approach to generative AI in games: the model runs on-device and is trained entirely on artwork commissioned from the studio’s own artists. CEO Piero Molino, whose team includes veterans from Uber, Meta, SEGA, and Creative Assembly, is building Bobium Brawlers, a mobile card-and-dice battler where players describe a creature in text and the game turns that description into a portrait and a playable deck that follows rules authored by the dev team.

The studio treats generative AI as a player-facing mechanic rather than a production shortcut, and it ships an Artist Rights Contract alongside the tech that guarantees explicit consent, project-specific usage rights, upfront compensation, and continued participation in a project’s success. The interesting engineering lesson comes from ten-plus prototypes: more AI control did not make games more fun. Excessive variability made rules feel arbitrary and stopped players from developing mastery, so the team clamped down with authored constraints.

It is an early but concrete answer to the question of whether ethical, artist-consented AI can power a real game rather than just a tech demo.

→ 80 Level

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Bad Inmate Brings Physics-Driven Prison Chaos to VR

HyperVR Games, the studio behind the absurdly well-reviewed Shave & Stuff and Titans Clinic, has dated its next made-for-VR sandbox. Bad Inmate is a physics-driven prison-break comedy coming to Meta Quest and PlayStation VR2 on October 15, with a SteamVR release to follow later.

The loop is pure sandbox chaos: turn everyday objects into weapons, craft your way to freedom by combining junk into improvised tools, and befriend, betray, or brawl with fellow inmates who each carry their own agenda. A full ragdoll physics combat system backs it up, alongside yard activities like basketball and weightlifting. The pedigree is the story here. Titans Clinic sits at 4.8 out of 5 stars from more than 16,000 reviews, and Shave & Stuff matches it from over 14,000, so HyperVR has a proven formula for turning a silly premise into a hit.

→ UploadVR

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Quick Bites

• Beat Saber Hip Hop Mixtape 2 is out now with eight tracks from Kendrick Lamar, Doja Cat, Lil Nas X, 21 Savage, and more, $10.99 for the pack or $1.99 per track, with an explicit lyric toggle for users 13 and up. → UploadVR
• The Blood of Dawnwalker shapes up as an open-world RPG built around a narrative sandbox, a more reactive take on player choice. → 80 Level
• Godot water tutorial: a deep dive on creating realistic water with dynamic foam in the open-source engine. → 80 Level
• Blender Guru’s Backrooms: the creator breaks down how to build the liminal-horror aesthetic of The Backrooms in Blender. → 80 Level