Compound Semiconductor Market

Compound Semiconductor Market Outlook from 2024 to 2034

The Compound Semiconductor Market is projected to be worth USD 40.2 billion in 2024. The market is anticipated to reach USD 88.0 billion by 2034. The market is further expected to surge at a CAGR of 8.1% during the forecast period 2024 to 2034.

Key Market Trends and Highlights

The expanding range of applications for compound semiconductors across industries such as automotive, aerospace, consumer electronics, and renewable energy creates new avenues for market growth and diversification.

• Government initiatives and funding programs aimed at promoting research and development in semiconductor technologies, including compound semiconductors, play a pivotal role in driving innovation and market growth.
• Increasing awareness and regulatory requirements for energy efficiency drive the adoption of compound semiconductor based solutions in various applications, such as LED lighting, renewable energy systems, and electric vehicles, contributing to market expansion.
• The integration of compound semiconductor materials, such as GaN and SiC, into power electronics, radio frequency devices, and optoelectronic components, enables the development of compact, energy efficient, and high performance systems across multiple sectors.

Attributes	Key Insights
Compound Semiconductor Market Estimated Size in 2024	USD 40.2 billion
Projected Market Value in 2034	USD 88.0 billion
Value-based CAGR from 2024 to 2034	8.1%

2019 to 2023 Historical Analysis vs. 2024 to 2034 Market Forecast Projections

The scope for compound semiconductor rose at a 10.1% CAGR between 2019 and 2023. The global market is anticipated to grow at a moderate CAGR of 8.1% over the forecast period 2024 to 2034.

Significant advancements in compound semiconductor materials, fabrication processes, and device technologies had driven the market growth during the historical period.

The proliferation of smartphones, tablets, wearables, and other consumer electronics also fuelled the demand for high performance compound semiconductor devices, including power amplifiers, RF switches, and LED displays, driving market expansion.

The automotive industry increasingly adopted compound semiconductor solutions for electric vehicles, hybrid vehicles, and advanced driver assistance systems to meet stringent performance, efficiency, and safety requirements, which contributed to market growth.

The forecast period is anticipated to witness the emergence of quantum computing technologies, driving demand for compound semiconductor materials and devices, including qubits, quantum sensors, and quantum communication systems, to enable the realization of scalable and fault tolerant quantum computing platforms.

The integration of compound semiconductor technologies in Internet of Things devices, edge computing systems, and smart sensors drives market growth, enabling the development of efficient, connected, and intelligent IoT ecosystems across various industries.

Continued emphasis on automotive electrification, autonomous driving, and vehicle to everything communication systems, drives demand for compound semiconductor solutions in electric vehicles, battery management systems, and automotive radar sensors, contributing to market expansion.

Compound Semiconductor Market Key Drivers

The rising demand for high performance electronic devices and power systems is driving the adoption of wide bandgap semiconductors such as Gallium Nitride and Silicon Carbide, which offer superior efficiency and power handling capabilities.

• Ongoing innovations and developments in compound semiconductor technology are enabling the production of more efficient and cost effective semiconductor devices. The advancements contribute to enhancing device performance and expanding application possibilities.
• The proliferation of applications requiring high speed and high frequency performance, such as 5G networks, automotive electronics, and power electronics, is driving the demand for compound semiconductor devices like III-V semiconductors and GaN based devices.
• Investments in semiconductor fabrication facilities, including those focused on compound semiconductor materials, contribute to expanding production capacity, improving manufacturing processes, and fostering technological innovation within the semiconductor industry.

Challenges in the Compound Semiconductor Market

The manufacturing processes involved in compound semiconductor production can be complex and costly, impacting the overall affordability and accessibility of compound semiconductor devices for various applications.

• Compound semiconductor materials, such as Gallium Nitride and Silicon Carbide, pose technical challenges related to epitaxial growth, device fabrication, and integration, which may limit scalability, yield, and performance in certain applications.
• The lack of standardized processes, interfaces, and specifications for compound semiconductor devices and materials may hamper interoperability, compatibility, and widespread adoption across different applications and industries.
• Security vulnerabilities and concerns related to cyberattacks, intellectual property theft, and supply chain risks may undermine confidence in compound semiconductor technologies and deter investment in critical infrastructure and applications.

Country-wise Insights

The below table showcases revenues in terms of the top 5 leading countries, spearheaded by Korea and Japan. The countries are expected to lead the market through 2034.

Countries	Forecast CAGRs from 2024 to 2034
The United States	8.2%
The United Kingdom	8.6%
Japan	9.4%
China	9.0%
Korea	10.9%

Investments in Research and Development Driving the Market in the United States

The compound semiconductor market in the United States expected to expand at a CAGR of 8.2% through 2034. Ongoing investments in research and development initiatives focused on compound semiconductor materials, device technologies, and fabrication processes drive innovation and technological advancements in the country.

Government agencies, academic institutions, and private companies collaborate to develop cutting edge semiconductor technologies, fostering growth and competitiveness in the market.

The United States boasts a robust semiconductor ecosystem, comprising semiconductor manufacturers, equipment suppliers, design firms, research institutions, and industry associations. The ecosystem fosters collaboration, knowledge exchange, and technology transfer, driving innovation and growth in the compound semiconductor market.

Government Support and Funding to Accelerate Market Growth in the United Kingdom

The compound semiconductor market in the United Kingdom is anticipated to expand at a CAGR of 8.6% through 2034.

The government in the country provides support and funding for semiconductor research, development, and commercialization through initiatives such as the Industrial Strategy Challenge Fund, Innovate UK, and the UK Research and Innovation agency.

Government investments bolster the competitiveness of the semiconductor industry in the country and stimulate growth in the market.

The country is at the forefront of emerging technologies such as 5G wireless communication, quantum computing, photonics, and advanced manufacturing. Compound semiconductors play a critical role in enabling these technologies, driving demand for advanced semiconductor materials and devices in the market.

Manufacturing Capabilities and Infrastructure Spearhead the Market in China

Compound semiconductor trends in China are taking a turn for the better. A 9.0% CAGR is forecast for the country from 2024 to 2034. China has established advanced semiconductor manufacturing facilities, including wafer fabrication plants, assembly and testing facilities, and packaging centers.

The availability of manufacturing capabilities and infrastructure supports the production of compound semiconductor devices and fosters growth in the market.

Chinese semiconductor companies are rapidly expanding their capabilities and market presence, investing in research and development, technology acquisition, and international partnerships. Domestic semiconductor companies drive innovation, localization, and competitiveness in the Chinese market.

Automotive Industry Demand Fueling the Market in Japan

The compound semiconductor market in Japan is poised to expand at a CAGR of 9.4% through 2034. Japan is home to major automotive manufacturers and suppliers that rely on compound semiconductor technologies for vehicle electrification, advanced driver assistance systems, and automotive infotainment systems.

Growth in the automotive industry drives demand for semiconductor materials and devices in Japan.

Japan places a strong emphasis on energy efficiency and environmental sustainability. Compound semiconductor materials and devices enable the development of energy efficient electronics, lighting systems, and power electronics, driving demand in the Japanese market.

Investments in AI and Semiconductor Convergence Driving the Demand in Korea

The compound semiconductor market in Korea is anticipated to expand at a CAGR of 9.8% through 2034. Korea invests in the convergence of semiconductor technologies with artificial intelligence, machine learning, and data analytics.

Integration of AI algorithms and semiconductor devices drives innovation in smart sensors, edge computing, and autonomous systems, creating new market opportunities in the country.

The healthcare and biotechnology sectors in Korea increasingly rely on compound semiconductor technologies for medical imaging, diagnostics, and biophotonics applications. Demand for semiconductor based medical devices and equipment drives growth in the market.

Category-wise Insights

The below table highlights how GaN segment is projected to lead the market in terms of type, and is expected to account for a CAGR of 7.8% through 2034. Based on group, the group IV-IV segment is expected to account for a CAGR of 7.5% through 2034.

Category	CAGR from 2024 to 2034
GaN	7.8%
Group IV-IV	7.5%

GaN Claims High Demand for Compound Semiconductor

Based on type, the GaN segment is expected to continue dominating the compound semiconductor market.

GaN semiconductor materials offer superior power handling capabilities and high frequency performance compared to traditional silicon based semiconductors, which makes GaN well suited for applications requiring high power density and efficiency, such as power electronics, RF amplifiers, and wireless communication systems.

GaN based devices exhibit lower on resistance and switching losses, resulting in higher energy efficiency and reduced heat dissipation compared to silicon based devices, which makes GaN technology attractive for power conversion applications, including data centers, electric vehicles, and renewable energy systems.

Group IV-IV to Hold High Demand for Compound Semiconductor

In terms of group, the group IV-IV segment is expected to continue dominating the compound semiconductor market, attributed to several key factors. Group IV-IV compound semiconductors, such as silicon germanium, offer compatibility with existing silicon based semiconductor processes and manufacturing infrastructure.

The compatibility allows for seamless integration of Group IV-IV materials into silicon based electronic devices and systems, enabling enhanced performance and functionality.

Silicon germanium compounds exhibit higher carrier mobility compared to pure silicon, making them well suited for high speed electronic devices and applications.

The enhanced carrier mobility of Group IV-IV materials enables the development of high performance transistors, amplifiers, and communication devices with improved speed and efficiency.

Competitive Landscape

The competitive landscape of the compound semiconductor market is dynamic and characterized by intense competition among key players, technological innovation, strategic partnerships, and market consolidation.

Compound semiconductors encompass a wide range of materials, including gallium nitride, silicon carbide, gallium arsenide, indium phosphide, and others, which find applications in various industries such as electronics, telecommunications, automotive, aerospace, and renewable energy.

Key Developments

• In 2022, Infineon Technologies AG and II-VI Incorporated finalized a multiyear supply agreement for wafers. The collaboration enables Infineon Technologies AG to secure additional access to critical semiconductor material, meeting the surge in customer demand within the sector. The agreement reinforces multi sourcing strategy of the company and enhances the resilience of its supply chain.
• In the same year, Qorvo unveiled its latest innovation, a new lineup of 1200V SiCFETs. The UF4C/SC series marks the introduction of the fourth generation of 1200V SiCFETs, derived from the recently acquired UnitedSiC technology. Specifically engineered for 800V bus architectures, these SiCFETs are tailored for use in onboard chargers for electric vehicles, industrial battery chargers, power supplies for industrial applications, DC/DC solar inverters, welding machines, uninterruptible power supplies, and induction heating systems.

Key Coverage in the Compound Semiconductor Industry Report

• Semiconductors Market Research
• Compound Semiconductor Market Growth
• Compound Semiconductor Materials Market Analysis
• Market Study on Compound Semiconductor Materials
• Demand of Compound Semiconductor Market
• Sales of Compound Semiconductor
• Compound Semiconductor Applications
• Semiconductor Substrates
• Compound Semiconductor Market Trends
• Compound Semiconductor Market Analysis
• Compound Semiconductor Technology Developments

Report Scope

Attribute	Details
Estimated Market Size in 2024	USD 40.2 Billion
Projected Market Valuation in 2034	USD 88.0 Billion
Value-based CAGR 2024 to 2034	8.1%
Forecast Period	2024 to 2034
Historical Data Available for	2019 to 2023
Market Analysis	Value in USD Billion
Key Regions Covered	North America; Latin America; Western Europe; Eastern Europe; South Asia and Pacific; East Asia; The Middle East & Africa
Key Market Segments Covered	Type, Group, Product, Application, Region
Key Countries Profiled	The United States, Canada, Brazil, Mexico, Germany, France, France, Spain, Italy, Russia, Poland, Czech Republic, Romania, India, Bangladesh, Australia, New Zealand, China, Japan, South Korea, GCC countries, South Africa, Israel
Key Companies Profiled	STMicroelectronics NV; NXP Semiconductor N.V.; Texas Instruments Inc.; Renesas Electronics Corporation; Infineon Technologies AG; SK siltron Co. Ltd.; Sumitomo Electric Industries Ltd.; JX Nippon Mining & Metals; FURUKAWA CO. LTD.; Shin-Etsu Chemical Co. Ltd.; SHOWA DENKO K.K.; Xiamen Powerway Advanced Material Co.; Freiberger Compound Materials GmbH; WIN Semiconductors Corp; IQE PLC

Segmentation Analysis of the Compound Semiconductor Market

By Type:

• GaN
• GaAs
• SiC

By Group:

• Group IV-IV
• Group III-V
• Group II-VI

By Product:

• LED
• RF Devices
• Power Electronics
• Others

By Application:

• Electronics and Consumer Goods
• Aerospace and Defense
• Others

By Region:

• North America
• Latin America
• Western Europe
• Eastern Europe
• South Asia and Pacific
• East Asia
• The Middle East and Africa

Frequently Asked Questions

What is the anticipated value of the Compound Semiconductor market in 2024?

The compound semiconductor market is projected to reach a valuation of USD 40.2 Billion in 2024.

What is the expected CAGR for the Compound Semiconductor market until 2034?

The compound semiconductor industry is set to expand by a CAGR of 8.1% through 2034.

How much valuation is projected for the Compound Semiconductor market in 2034?

The compound semiconductor market is forecast to reach USD 88.0 Billion by 2034.

Which country is projected to lead the Compound Semiconductor market?

Korea is expected to be the top performing market, exhibiting a CAGR of 10.9% through 2034.

Which is the dominant type in the Compound Semiconductor domain?

GaN segment is preferred, and is expected to account for a CAGR of 7.8% through 2034.