The Compound Semiconductors market is anticipated to grow at CAGR 10.65% and reach a market size worth US$102.764 billion by the end of 2026. The market was valued at US$50.606 billion in 2019. The prime region driving the growth in this market is the surging adoption of compound semiconductors in the consumer electronic and automotive industry.
Compound Semiconductors are semiconductors that are made from more than one element, particular is a combination of more than one element from Group 3 and Group 5 of the periodic table. Efficient compound semiconductors can also form from elements mixture of group 2 and group 6. Group 4 has unique properties that elements within the group have the capability of formation of compound semiconductors. Silicon, germanium, and selenium are examples of semiconductors which are not a compound semiconductor as they are made from fewer elements from the same group (except those from group 4). These semiconductors are widely used across the consumer electronics and automotive sectors. However, the market is constrained by high costs across the complete supply chain owing to complicated systems.
Simple Semiconductors Give Competition to Compound Semiconductors
The compound semiconductor market faces great competition from simple semiconductors, even though they possess more properties that outperform simple semiconductors. Silicon, germanium, and selenium are an example of simple semiconductors which are efficient and lower in cost, as compared with compound semiconductors. Silicon is the 2nd largest available element on Earth, after water, and is found in soil, water, plants, and trees. However, it is not available in pure form. For semiconductors, 99.999% pure silicon is required, which is extracted using processing. Furthermore, since compound semiconductors involve a merger of more than one element from different groups, there are chances and risk of defaults, which constrain the market for them.
Consumer Electronics Segment of the Market Has Huge Growth Potential For Quantum Compound Semiconductors During the Forecasted Period
Based on End-Users Industry, the market for compound semiconductors is segmented as consumer electronics, automotive, energy and power, communication and technology, healthcare, and others. the consumer electronic segment of the market is anticipated to grow the demand for compound semiconductors at an exponential rate during the forecasted period owing to surging demand for their industrial goods. Compound semiconductors have the property of electron mobility, lower power consumption, and significant temperature limits, making them quite useful in electronics and equipment. The consumer electronic industry has realized exponential market demand growth in the past decade with surging demand for advanced products such as smartphones. Research and development have resulted in innovation in the industry and the launch of new products such as smartwatches, smart tabs, smart TVs, health-tracking devices, and others. Moreover, a surge in disposable income, especially in developing nations, along with increased consumer expenditure on the latest electronics has spiked the demand for compound semiconductors to be used in consumer electronics.
Semiconductors facilitate several functions in a vehicle, such as power for battery management, in-car entertainment, and driver assistance, hence having a crucial role in the automobile industry. compound semiconductors are slowly adopted by the automotive industry which is growing at a significant pace. Skyrocketing demand for automotive, especially passenger cars for private and commercial use is boosting the demand for spare parts, including compound semiconductors. The healthcare sector as well is anticipated to contribute considerably to the market growth of compound semiconductors while the energy and power and communication and technology segment provide immense market potential. The telecommunication industry is expected to increase market demand for compound semiconductors with surging usage of smart devices and demand for an advanced network such as the 5G network.
The Atomic Layer Deposition Fabrication Process of Compound Semiconductors Will Grow at a Significant Rate During the Analyzed Period
Based on the fabrication process, the market for semiconductors is fragmented as Hydride Vapor Phase Epitaxy (HVPE), Metalorganic Vapor Phase Epitaxy (MVPE), Atomic layer deposition (ALD), and others. the ALD fabrication process is predicted to grow at a significant rate during the forecasted period while HVPE and MVPE will dominate the market for the fabrication process of compound semiconductors.
The online distribution channel has seen a surge in demand with rising internet penetration across the world. Firms are also launching online channels or selling their products through existing online spaces. Texas Instruments, for example, announced in December 2020 the availability of its high-reliability semiconductor products on the online platform TI.com, facilitating defense and aerospace companies to receive authentic TI products.
Asia Pacific Region Will Outstand the Market and Grow at an Exponential Rate
Based on Geography, the market for compound semiconductors is segmented as North American region, South American region, European region, the Middle East and African region, and the Asia Pacific region. The North American region is predicted to dominate the market during the forecasted period owing to its state-of-art infrastructure and technological advancement. The government as well as supporting the development of infrastructure for better technological penetration. In November 2020, the U.S. government contracted with Qorvo Inc. to develop state-of-art infrastructure for the development of heterogeneously integrated packaging RF production and prototyping center.
The Asia Pacific region, on the other hand, is predicted to grow at the fastest rate during the forecasted period and attain a huge market. the prime reason for market growth is mushrooming consumer electronic and automobile industries in the region demanding more semiconductors for production. The region has also incurred a booming market for consumer electronics with the rise in consumer disposable income. Firms operating in the industry in this area are also strengthening their strategies to incorporate the growing market demand. Toshiba, for instance, merged its two subsidiaries to form Toshiba Electronic Device Solution Corporation for better R&D of its semiconductor business. The market has huge growth potential in the region.
COVID Pandemic Impact
The coronavirus pandemic has a severe impact on the compound semiconductor market which is covered in detail in the analysis report. Nationwide lockdown resulted in a disturbed supply chain and sluggish production, harming the industry significantly.