Industry Overview
The Global VCSEL Market is anticipated to grow from USD 1.5 billion in 2023 to USD 3.7 billion in 2030 at a CAGR of 14.3% during the forecast period from 2025 to 2030.
VCSEL (Vertical cavitiy surface emitting laser) is a laser diode that vertically emits light in a cone-shaped beam from the surface of a fabricated wafer. Various benefits are offered by VCSELs in comparison with conventional edge-emitting lasers where light is emitted on one or two edges of the chip. VCSELs are available in different wavelengths for the industry or the consumer market. The standard wavelengths are in the range of 760 nm, 850 nm and 940 nm. These lasers also offer high efficiency, reliability, precision and high speed with a cost-effective solution which are the new technological developments in laser physics.
The market is segregated by type such as single-mode and multi-mode, where multi-mode segment dominates the market and by application such as illumination, and sensing, data communication, industrial heating, among which sensing shall grow due to increase in demand for object detection and face recognition. It is also divided on the material into gallium arsenide(GaAs), indium phosphide (InP) and gallium nitride (GaN) and by end-user divided into consumer electronics, automotive, IT & telecom, commercial and industrial, healthcare and military.
Market Segmentation
Insight by Type
According to type, the global VCSEL market segmentation includes single-mode and multi-mode. The multi-mode segment held the market, with the largest market revenue due to its cost-effectiveness, high-speed data transfer capabilities and lower power consumption which is mainly utilized in automotive, aerospace and medical systems.
Insight by Application
The global VCSEL market segmentation based on application, comprises of infrared illumination, sensing, data communication, industrial heating. The sensing segment dominates the market of VCSEL during the forecast period as there is increase in demand for object detection and face recognition along with developments in logistics and home & building automation. VCSEL-based sensors enhance precision and speed in smart-phones, consumer electronics, automotive and manufacturing applications.
Insight by Material
On the basis of material, the VCSEL Market is divided into gallium arsenide(GaAs), indium phosphide (InP) and gallium nitride (GaN). GaAs is led the VCSEL market due to the rising adoption of GaAs-based vertical –cavity surface emitting lasers in proximity sensors that are being integrated in smart-phones and the other consumer devices.
Insight by Enduser
Based on end-user, the VCSEL Market is segregated into consumer electronics, automotive, IT & telecom, commercial and industrial, healthcare and military. The automotive segment dominates the market of VCSEL during the forecast period due to the expansion of the application of these devices in driver monitoring systems.
Global VCSEL Market Report Coverage
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Report Metric
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Details
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Historical Period
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2018 - 2023
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Base Year Considered
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2024
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Forecast Period
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2025 - 2030
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Market Size in 2023
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U.S.D. 1.5 Billion
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Revenue Forecast in 2030
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U.S.D. 3.7 Billion
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Growth Rate
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14.3%
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Segments Covered in the Report
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By Type, By Application, By Material, and By End-User
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Report Scope
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Market Trends, Drivers, and Restraints; Revenue Estimation and Forecast; Segmentation Analysis; Impact of COVID-19; Companies’ Strategic Developments; Market Share Analysis of Key Players; Company Profiling
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Regions Covered in the Report
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North America, Asia-Pacific, Europe, and Rest of the World
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Industry Dynamics
Growth Drivers
Now-a-days, optical interconnect infrastructures in the data centers have advanced from 100 Gbit/s. to the next-generation 400 Gbit/s data. This is mainly due to the ever-increasing data traffic in data centers because of rapid market growth of emerging technologies like VR/AR, AI and the Internet of Things (IoT) along with the introduction of 5G mobile network systems. The VCSEL market is anticipated to witness strong growth during the forecast period due to rising requirements for transmitting data over long distances with high speed and efficiency, increasing demand in automotive LiDAR applications of these lasers and industrial applications. Also adoption of VCSELs in smartphones by smartphone manufacturers for 3D sensing is the factor driving the market growth. During the COVID-19 pandemic various end-user industries that deploy VCSEL faced several difficulties as these industries were stuck with nationwide lockdowns, which had brought them to a standstill, they gradually started their operation after Q2 of 2020. Geopolitical tensions and conflicts worldwide drive the demand for military spending.
Restraints
High cost of the lasers is the major constraint of the VCSEL Market despite their various advantages. VCSELs are expensive to manufacture, compared to traditional LED laser technologies. The VCSEL market faces competition from alternative technologies like organic light-emitting diodes (OLEDs), edge-emitting lasers and LEDs. The complex manufacturing process involved in producing VCSELs face challenges in terms of production costs, yield and scalability.
Geographic Overview
- North America
- Europe
- Asia Pacific (APAC)
- Rest of the World
Geographically, the Global VCSEL Market is classified into North America, Europe, Asia Pacific, and the Rest of the world. The North American VCSEL market dominates the market due to innovations in advanced technologies and the rise in data communication applications. Rising adoption of enterprise mobility and extensive wireless connectivity has led to the growth of the VCSEL market in the North American region. The US is the highest contributor in this region. The Asia-Pacific VCSEL Market is the second-largest market due to the rising adoption of VCSEL solutions.
Competitive Insights
TRUMPF Photonic Components (headquartered in Ulm, Germany), is a global technology leader, providing VCSEL and photodiode solutions for industrial sensing, datacom, consumer electronics, automotive and industrial heating markets. The new generation 940 nm VCSEL arrays permit breakthrough advancements in different functionalities coupled with high-reliability performance, like long product lifetime at a broad temperature range. Thus, the new VCSEL generation provides better results in advanced optical applications such as laser autofocus, proximity sensing and under OLED display sensing.
Semtech Corporation is a leading supplier worldwide of high-performance analog and mixed-signal semiconductors and modern algorithms. The company is based in Camarillo, Ventura County, Southern California, and was founded in 1960. The company is a high-performance semiconductor, cloud connectivity, and IoT systems service supplier dedicated to offering high-quality technology solutions that offer a smarter, more sustainable, and more connected planet.
Key Players Covered in the Report
Manufacturers in the global VCSEL industry use one of the key business tactics of manufacturing locally to minimize operational costs to benefit clients and increase the market sector. Companies are investing in research and development operations to offer some of the most significant advantages to technology. Key players of VCSEL Market are Coherent Corporation, Lumentum Operations LLC, Vixar Inc (OSRAM AG), Hamamatsu Photonics KK, TRUMPF Group , Semtech Corporation, IQE plc, WIN Semiconductors, Frankfurt Laser Company.
Recent Development by Key Players
AMS OSRAM AG and the Malaysian Investment Development Authority (MIDA) collaborated for the continued investment and expansion in Malaysia. MIDA demonstrates significant support for ams OSRAM’s initiatives in Malaysia.
Coherent Corp. (a leader in semiconductor lasers for depth sensors), has introduced an illumination module platform for short- and mid-range light detection and ranging (LiDAR) in automotive safety and robotic vision in industrial applications.
The global VCSEL Market report offers a comprehensive market segmentation analysis along with estimation for the forecast period 2025–2030.
Segments Covered in the Report
- By Type
- By Application
- Infrared Illumination
- Sensing
- Data Communication
- Industrial Heating
- By Material
- Gallium Arsenide(GaAs)
- Indium Phosphide (InP)
- Gallium Nitride (GaN)
- By End-User
- Consumer Electronics
- Automotive
- IT & Telecom
- Commercial and Industrial
- Healthcare and Military
Region Covered in the Report
- North America
- Europe
- Germany
- U.K.
- France
- Italy
- Spain
- Russia
- Rest of Europe
- Asia-Pacific (APAC)
- Rest of the World
- Brazil
- Saudi Arabia
- South Africa
- U.A.E
- Other Countries
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Source: VynZ Research
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