Opto Semiconductors Market Size, Share & COVID-19 Impact Analysis, By Type (LED, Image Sensors, Infrared Component, Optocouplers, and Laser Diode), By Application (Residential & Commercial and Industrial), and Regional Forecast, 2021-2028

The global opto semiconductors market size was USD 40.48 billion in 2020. The global impact of COVID-19 has been unprecedented and staggering, with opto semiconductor witnessing a negative demand shock across all key regions amid the pandemic. Based on our analysis, the global market exhibited a huge decline of 2.6% in 2020. The market is projected to grow from USD 44.63 billion in 2021 to USD 97.52 billion in 2028 at a CAGR of 11.8% during the 2021-2028 period. The sudden rise in CAGR is attributable to this market’s demand and growth, returning to pre-pandemic levels once the pandemic is over.

Opto semiconductors have simplified autonomous vehicles with viable technology implementation. Optical semiconductors have become essential for the operation of the economy and national security of the data. The growing demand for opto semiconductor is bringing new convenience to previously impossible operations.

Furthermore, wireless and 5G technologies are expected to bring in huge transformation in the global market. These technologies are expected to usher a wide variety of functions from autonomous applications to IoT and connected applications. Some examples of the applications for 5G & wireless technologies will be in smart cities, electric vehicles, intelligent cars, smartphones, etc. 5G and wireless technologies rely heavily on advanced optical sensors, LED’s, and associated technologies, as these are the main features for fully deploying the technology needed for smart cities and factories, as well as fully autonomous vehicles. Furthermore, prominent sensor and LED manufacturers along with telecommunication equipment suppliers such as Osram, TT Electronics, etc., are expected to introduce various solutions to contend for high market share in the 5G technology.

COVID-19 Pandemic: Obstructed Automotive Sectors in Asian Countries to hamper Market Growth

The shockwaves of the COVID 19 pandemic disrupted the economies of the globe. Furthermore, the growth rates in the emerging Asian countries also contracted in 2020, as manufacturing activities in plants across the Asian countries were on hold. The market was expected to witness a decline in the pandemic period, but it is anticipated to resume its normalcy from the end of 2020. The industry is facing challenges to maintain the global economy across several sectors. Due to the active participation of the manufacturers and government to recover the depths that occurred and working on various strategies to embrace the growth of the market. Also, market players face difficulties predicting future demand as a greater amount of uncertainty abounds in the automotive and industrial sectors, decelerating the GDP growth of developing countries. However, during the forecast period and post-recovery from the pandemic, the demand for this type of semiconductors are expected to accelerate at a significant rate due to the demand across consumer electronics such as laptops and handsets, automotive, data centers, communication, etc.

LATEST TRENDS

Adoption of Laser-Powered 3D Display and Laser LIFI to Amplify Market

The emerging semiconductor laser technologies such as laser LIFI, laser-powered 3D displays, plasmonic nanostructures, and others are revolutionizing the optical sensing and industrial material processing market across the globe. Industries such as automotive, telecommunications, consumer electronics, and others specifically benefit from laser LIFI and laser-powered 3D Display technologies. These technologies simplify system design architecture, thus resulting in the adoption of these technologies in recent years.

With rapid advances in the electronics sector, laser-powered 3D display technology is strongly making its way into the marketplace as it preserves full image resolution to each view of the 3D display. Additionally, the latest glass-free 3D display developed by the engineers utilizes a laser to create giant images outdoors for stadium events and electronic billboards. South Korea, China, the U.S., Austria, Japan are some of the countries that utilize these displays for the viewers.

DRIVING FACTORS

Adoption of Outsourcing Opto Electronics Manufacturing Services (EMS) to Boost Demand

Several industrial sectors opt for outsourcing electronics manufacturing services (EMS) because it offers original and high-quality products at low costs; this helps gain a competitive advantage for the manufacturers and improve the market growth. As the outsourcing organizations achieve and maintain certifications that offer reliable high end-user sensors, LED, optocouplers, etc. For automotive, consumer electronics, and many other sectors, this depicts the commitments to a focused group of industries, hence surges the global demand.

Therefore, the adoption of outsourcing the opto semiconductors/electronics such as LED, optical sensors, optocouplers, photonic cells, etc., is projected to thrust the opto semiconductors market growth over the forecast period.

RESTRAINING FACTORS

Thermal & Physical Testing Precincts Opto-Semiconductors Integration to Restraint the Growth

Modern optoelectronic devices are manufactured using organic or inorganic semiconductor material, causing energy loss and heating of the device. The generated heat leads to inconsistency and creates abeyant centers in the material, becoming a source of heat generation in the semiconductor material. The major challenging factor of thermal testing and management is the temperature measurements of optical semiconductor devices. These devices are fabricated with a poor thermal conductivity that leads to difficulties while mounting the devices on temperature sensing platforms. To overcome the challenges of thermal and physical testing, researchers are opting for IR-thermography. IR-thermography minimizes the heat sinks over the device, and manages the temperature and stability of the device.

SEGMENTATION

By Type Analysis:

Image Sensors to hold highest CAGR based on demand

Based on type, the market is segmented into LED, image sensors, infrared components, optocouplers, and laser diodes.

The market for image sensors is expected to exhibit a strong growth rate in the coming years. As the demand for these sensors has been growing for the last two decades and is expected to continue. The growth is owed to the ongoing technological advancements such as self-drive vehicles and image recognition for security purposes in smart end-user devices.

Key market players are involved in massive capital spending on image sensors and LEDs to support innovations such as inexpensive 3D imaging, laser Li-Fi, laser-powered 3D display technology, quantum dots, and other complexes, real-time workload applications. A light-emitting diode is an electric component, and a light source in semiconductors emits light while the electric current flows via it. It is a p-n junction diode with a forwarding direction of current flow. LEDs are heavily doped with a semiconductor material, and the amount of doping results in an emission of colored light through LEDs with a spectral wavelength. LEDs are highly used in consumer electronics and automotive applications.

Optocouplers, also known as optoisolators or photo-coupler, are electronic components that transfer electrical signals across two isolated circuits using the light. Optocouplers is a combination of LED that emits infrared light and a semiconductor photo-sensitive device that detects the emitted infrared light. These are used in automotive, telecommunications, healthcare, consumer electronics, etc.

Infrared components are anticipated to witness progressive market growth in the coming years, with rising demand from the consumer electronics, telecommunication, healthcare, and automotive sector for complex applications.

By Application Analysis

Industrial Application to Witness Major Growth.

Based on application analysis, this market is divided into Residential & Commercial, and Industrial.

The industrial application, which includes automotive, consumer electronics, telecommunication, healthcare, energy & power, and others (military, utilities, etc.), is projected to grow at a significant CAGR with the increasing demand for consumer electronics and automotive around the world. Furthermore, connected technologies have been surging the demand across the automotive electronics sector, with rising demand for high-quality and accurate sensors and LEDs for autonomous vehicles. This demand is owed to the increased use of electronic components for advanced safety features and cutting-edge technologies added to the vehicles. Consumption of semiconductors in automotive electronic components includes infotainment, safety, navigation, fuel efficiency, etc., and their application is expected to increase in the coming years.

Connected technologies enhance security, energy savings, and applications of IoT devices and hence are expected to create extended market opportunities for the market in the coming years.

Residential and commercial segments have considerably grown since the last two decades owing to the rising amount of innovative construction designs and implementation of LEDs every day around the world, overcoming the challenges related to lightning; propelling the semiconductor market globally.

REGIONAL INSIGHTS

Asia Pacific is considered to have exponential growth with the highest CAGR over the forecast period, owing to growth in the semiconductor industry across China, India, Taiwan, South Korea, Japan, etc. The market is likely to rise by the evolving automobile, medical, and industrial manufacturing companies and the increasing demand & supply for optoelectronics from the overseas markets of North America and Europe. Also, the rising living standards in countries such as China, India, Australia, etc., which will increase the residential & commercial application, have also surged the market growth. Moreover, the increase in the working population in the region is expected to boost the demand.

China to Witness Highest CAGR with Emerging Local Semiconductor Manufacturers

China is expected to hold and exhibit the highest growth in the coming years. This is owing to the increasing presence of local semiconductor manufacturers. These manufacturers offer wide ranges of products worldwide, that too at affordable prices. China is recognized among the largest electronics product manufacturers and exporters globally. The presence of a huge number of these local manufacturers and their variety of offerings and product options interests the global consumer base and is estimated to augment the market's growth in the coming years.

North America is projected to hold the second-largest market share owing to the invention of the optoelectronic devices in the U.S. Post lockdown, the U.S. had the largest ongoing semiconductor research and development with huge investments in 2019. As a result, the region would create significant impetus for the optoelectronics market size.

The European market is projected to grow with a stable CAGR during the forecast period. Optical semiconductors will increase in the region due to the increase in the demand for smartphones and consumer electronics. Furthermore, the increasing demand from the automotive industry will further fuel the demand in the coming years.

Due to the rise in the U.S- North America market, South America is anticipated to exhibit substantial growth. As the US market is projected to see growth in the future hence this growth will also affect the South American market, and simultaneously, the demand will increase. Demand in the commercial sector is also expected to enhance the growth in the region.  

The Middle East is predicted to witness a strong boost in the global market for opto semiconductors due to the increase in usage of electronic and automotive products. Also, the rise in commercial & residential applications could be a solid contributor to market growth. Whereas Africa is likely to exhibit slow growth due to a lack of technology in the region.

KEY INDUSTRY PLAYERS

New Product Launch by Key Players to Revivify their Market Presence

Leading players are striving for excellence in the global optoelectronics market by targeting the strong manufacturing and technology foundation, investment for an extended portfolio of power electronics products, strong sales force & diversity, and longevity of products and end-users.

The market is growing with increasing technological advancements, and there are many well-known brands in the market, along with regional players, to cater to the increasing demands. LITE-ON Technology, Inc., ON Semiconductor Corporation, OSRAM, Vishay Intertechnology, Inc., Mitsubishi Electric Corporation, and Toshiba Corporation are considered prominent players in the global market. These manufacturers continuously develop opto semiconductors in anticipation of demand for advanced information technology (IT), 5G, 3D integration technology, and other technologically advanced products. For instance, perovskite transistors, optical quantum dots, plasmonic nanostructures, etc.

Prominent players are emphasizing long-term investment activities to maintain liquidity and preserve capital while generating appropriate returns.

LIST OF KEY COMPANIES PROFILED:

• TOSHIBA ELECTRONIC DEVICES & STORAGE CORPORATION (Japan)


• ROHM CO., LTD. (Japan)


• Vishay Intertechnology, Inc. (United States)


• Renesas Electronics Corporation. (Japan)


• ON Semiconductor (United States)


• Broadcom (United States)


• Mitsubishi Electric Corporation (Japan)


• LITE-ON Technology, Inc. (Taiwan)


• TT Electronics (United Kingdom)


• OSRAM Opto Semiconductors GmbH (Germany)

KEY INDUSTRY DEVELOPMENT:

• January 2021 - ROHM, together with Sanden Huayu Automotive Air-Conditioning Co., Ltd., China’s largest manufacturer of automotive air conditioners, held an opening ceremony announcing a joint technical laboratory at Sanden Huayu’s headquarters in Shanghai, China.


• December 2019 - Mitsubishi Electric Corporation launched the ML562G86 pulse laser diode (LD) for projectors, featuring a vibrant 638-nanometer (nm) red light, the output power of 3.0W under pulse operation and mean time to failure1 (MTTF) of over 20,000 hours.

REPORT COVERAGE

The global opto semiconductors market research report provides a detailed analysis of the market. It focuses on key aspects, such as competitive landscape, leading companies, product/service types, and leading product applications. Besides, the report offers insights into the current market trends and highlights key industry developments resulting from primary and secondary research studies. In addition to the factors mentioned above, the report encompasses the analysis of several key factors that have contributed to the growth of the market over recent years.

Report Scope & Segmentation