The Global Compound Semiconductor Market was valued at US$ 29.35 Billion in 2020 and is expected to reach US$ 47.23 Billion by 2027, with a CAGR of 6.2% during the forecast year (2021-2027).
The increase in demand for high speed and efficiency products and rising adoption of high-end technologies such as artificial intelligence, machine learning, and Internet of Things (IoT) in the communication sector are the prime factor boosting the compound semiconductor market growth. This is because, IoT applications cannot function without sensors and integrated circuits, so all IoT devices requires semiconductors, which thereby increases the demand for compound semiconductor globally. Furthermore, emerging technologies such Artificial Intelligence, digitalization are also positively impacting the growth of compound semiconductor market.
In addition, growth in the automotive industry has positively impacted the growth of compound semiconductor market. Semiconductors facilitate various benefits in a vehicle, like, in-car entertainment, power for battery management, and driver assistance, hence having a crucial role in the automotive industry. Owing to these properties, compound semiconductors are increasingly adopted by the next-generation vehicles. Moreover, many countries now have laid several policies on increasing the adoption for Advanced Driver Assistance System (ADAS) which is further expected to drive the compound semiconductor market. For instance, in July 2010, a legal framework was adopted by all countries present in Europe to accelerate the execution of ADAS technology. The European Union is working towards the early adoption of advanced technology to enhance passenger safety and give priority to innovative transport technologies. Thus, growth in the automotive industry, especially in passenger cars for commercial and private use is boosting the demand for spare parts, including compound semiconductors.
One of the major challenges faced by global compound semiconductor market is the high material and fabrication costs associated with compound semiconductors. The average cost of a compound semiconductor device is higher than the average cost of per pure silicon semiconductor device. This is mainly because the production process is new, complex, requires high-priced state-of-the-art equipment and use advanced technologies. Additionally, they lack familiarity and require expertise in manufacturing processes by executives of compound semiconductor industry players.
Based on region, APAC region has dominated the compound semiconductor market globally and is expected to show similar growth trends in the coming years. This is due to the growing commercialization of 5G services in the major countries in the region. Countries such as China, Japan and South Korea have completed 5G verification tests based on existing networks and will start rolling up the 5G technology sooner. It is expected that led by these pioneering countries, Asia Pacific will be the largest 5G region in the world by 2025, thereby positively impacting the growth of compound semiconductors. The increasing demand for consumer electronics in several Asian countries such as China, Japan, Taiwan, the Philippines, and India has also attributed for increasing the demand of compound semiconductor globally. In addition, the development of several data centers in these nations by prime companies such as Facebook (US), Microsoft (US) and Google (US) is expected to increase the demand for compound semiconductors.
Compound Semiconductor Market Key highlights:
Compound Semiconductor Market Key News
Global Compound Semiconductor Market Type Outlook (Revenue, USD Billion, 2021-2027)
Global Compound Semiconductor Market Product Type Outlook (Revenue, USD Billion, 2021-2027)
Global Compound Semiconductor Market End-Use Industry Outlook (Revenue, USD Billion, 2021-2027)