Compound Semiconductor Market

Compound Semiconductor Market Size, Share, Growth (2023-2028)

Compound semiconductor market size is USD 59.8 billion by 2028, growing at a compound annual growth rate (CAGR) of 5.1% during the projected period.

Compound Semiconductor Market Overview

Two or more elements from the same or different periodic table groups are joined to form the compound semiconductor. The growth in the compound semiconductor market has been noticed more during recent years with the rise in its application in electronic and mobile devices. The technology used in the manufacturing of compound semiconductors is chemical vapor deposition, atomic layer deposition, etc. There are some unique properties of compound semiconductors, which are high-temperature resistance, high band gap, operates fast with enhanced frequency. The market is also expecting some technological advancements and some specific product design developments in compound semiconductors.

Compound Semiconductor Market Drivers

The penetration of SiC devices in the power electronics industry increased because, when compared to silicon-based devices, it has more breakdown strength of approximately 10 times and thermal conductivity is more than three times. Thereby reduction in the device's complexity and operational cost, which enhances its reliability and increases its suitability for high-voltage applications for a wider range. High-voltage applications include solar inverters and power suppliers. Power electronics can control and conversion of electrical power in an effective and efficient way. This resulted in an increase in demand for power electronics driving the market growth. The proliferation of the GaN use in the development of the 5G infrastructure, with the increase in the need for the technology incorporation, could deliver better performance and value for the 5G wireless base stations, is also having the ability in rising demand for the compound semiconductor market. There will be a positive impact on the market growth with a variety of advantages offered in consumer electronics by compound semiconductors.

Compound Semiconductor Market Restraints

Compound semiconductors are associated with high expenditure and fabrication costs. There is also high expenditure involved in the complete supply chain of the compound semiconductor market industry process. There is a comparatively high average expenditure per product in the supply chain process involved in the compound semiconductors than the pure silicon semiconductor devices. The complex process, employment of new advanced technology, and high-priced equipment in the semiconductor industry are the primary reasons for the high cost. Lack of standardization and expertise in the manufacturing process is also a restraint. These are more expensive than Si raw materials because of the commercial synthesis of the compound semiconductors under high temperatures. Device fabrication is also a costlier process restraining the adoption of compound semiconductors. Lack of equipment with advanced technologies, the final phase process, such as assembling, testing, and packaging, becomes costlier. These restraints create a negative impact on the market and resist the entry of new market players. At last, the growth and development of the compound semiconductor market are hindered by these restraints that directly affect the number of market players. 

Compound Semiconductor Market Opportunities

In the compound semiconductor market, GaN semiconductor has a great market opportunity in the coming years. The GaN compound semiconductor can have a potential in the 5G wireless base stations as the 5G infrastructure requires technologies having the delivery efficiency, performance, and value that these vital requirements can be met through the GaN solutions. Some other advantages of GaN use include high thermal conductivity, reliability, better efficiency, high robustness, and high frequency. Some power amplifiers are obtaining benefits from all transmission cells in the network and resulting in a noticeable impact on the 5G deployment in the coming generation.

COVID-19 Impact on the Compound Semiconductor Market

The COVID-19 pandemic has shown both positive and negative impacts on the compound semiconductor market. The disruptions in the supply chain of the market because of the lockdown imposed resulted in delayed projects. The imbalance between supply and demand caused due to the breakdown of the operations in the industries, and production levels are not met the manufacturing industry capacity. The non-availability of the workforce and decreased movement across the locations reduced the production working hours in the industry. The exports and imports restriction led to delay reach of the raw materials from the production to the application site. The increased use of smart wireless devices and smart home appliances during the pandemic led to increased demand for the semiconductors requirement, which is used in these products manufacturing. 

Key developments in the market

• In 2022, a new combined ambient light (ALS) and proximity sensor were launched by OSRAM. In the most delinquent smartphones, this newly launched product, even working behind the high speed and high-definition OLED screens, can provide accurate color and reliable proximity detection.

• In 2022, the Lucid Air of the Lucid Motor, which is a pure-electric car and has high performance, is no longer employed with its silicon carbide power device solutions. An agreement was also made for the production and supply of SiC devices. These are announced by Wolfspeed.

Compound Semiconductor Market Segmentation

By Type

• Gallium Arsenide (GaAs)

• Gallium Nitride (GaN)

• Gallium Phosphide (GaP)

• Silicon Carbide (SiC)

The Gallium Nitride (GaN) is expected to have a large market share in the compound semiconductor market because of the features and advantages of the GaN. The GaN can emit UV and visible light and can withstand high temperatures and voltages, making it more in demand in the applications of lighting and power transistors. It also produces silicon chips in an easy and fast way, makes to the adoption of the GaN by many companies. The essentiality of Gallium nitride technology is becoming more essential in some applications, such as in places where a physical limit has been reached with silicon usage in the power conversion platform.

By Product

• LED

• RF

• Optoelectronics

• Power Electronics

Power electronics is projected to have a large market share in the compound semiconductor market. The wider applications of the power electronics module in smart home appliances will drive market growth. GaN is becoming important in power electronics and enabling companies to give efficient solutions to customers. For instance, the efficiency has been enhanced by the GaN in wireless electronic devices.

By Application

• Telecommunications

• Information & Communication Technology

• Defense & Aerospace

• Consumer Electronics

• Healthcare

• Automotive

Telecommunications accounted to have a high share in the compound semiconductor market. It had a market share of 40% in 2022, and the same trend is expected to see in the coming years. The rise in the demand for semiconductors used in the applications of wireless and mobile communication. Compound semiconductors also have high efficiency over silicon semiconductors and drive their usage in advanced communication technologies. The emerging new technologies demand high-speed and efficient semiconductors.

Compound Semiconductor Market Regional Analysis:

• North America

• Europe

• Asia Pacific

• Latin America

• Middle East & Africa

Asia-Pacific region is expecting to have high market revenue in the compound semiconductor market during the forecast period. This region is having a rise in consumer electronic devices and increased adoption of wireless communication technologies by the people. The shift in consumer preference towards smart and innovative solutions drives market growth. In the North American region, the U.S. holds a high share of the compound semiconductor market. The region owing to the increased investment by the key vendors, will propel the compound semiconductor market in the consumer electronics and IT and telecommunication sector. 

Compound Semiconductor Market Key Players

1. LM Ericsson Telefon ABSumitomo Electric Industries

2. Wolfspeed Inc.,

3. Analog Devices

4. Taiwan Semiconductor Manufacturing Company Ltd

5. Nichia Corporation

6. Samsung Electronics,

7. Canon Inc.

8. Freescale Semiconductor Inc.

9. Infineon Technologies