[nwienert]

Many will say otherwise but the most accurate answer is that it’s short for “Xtreme Reality” - for example, if you look at a car, it will add flames to the side. Look at your dad - bleached blonde tips. Stuff like that.

[dangrover]

Also, other characters in XR have predilection to say stuff like "You can't make it spicy enough for me!" and “Holy moly, Stromboli!”

[mellosouls]

That's not the most accurate answer, though perhaps it has some usage in that sense; it's not what it means in the context here.