With the continuous advancement of technology, new materials and new processes are constantly introduced in the field of compound semiconductors to improve device performance and reduce costs. For example, new materials such as gallium arsenide (GaAs), gallium nitride (GaN), and potassium carbide (SiC) have shown great potential for high-frequency, high-impact applications and are expected to be more widely used in the future. In addition, with the continuous improvement of chip integration, compound semiconductor devices will become more miniaturized and efficient. This will not only help improve the overall performance of electronic products, but will also promote the development of emerging fields such as the Internet of Things and wearable devices.
According to market research firm Yole, the compound semiconductor industry is booming and has become an important player in the alongside carbon-based semiconductors, which not only have excellent performance, but also have a function that silicon does not have: emitting light. With the global deployment of 5G networks and the acceleration of R&D of 6G technology, the demand for high-speed, high-frequency, and low-power compound semiconductor devices will continue to grow. These devices play an important role in key links such as base stations and terminal equipment. The rapid development of new energy vehicles and autonomous driving technology has also put forward higher requirements for compound semiconductor devices. High-performance, high-reliability power electronics and sensors have become the new favorite of the market. With the advent of the era of big data, the demand for high-performance computing in data centers and cloud computing is increasing. Due to its excellent performance characteristics, compound semiconductor devices have broad application prospects in data center servers, storage systems and other fields.
Figure: 2023-2029 compound semiconductor market (Source: Yole)
According to Yole's report, the compound semiconductor market has matured and formed a complete ecosystem, and the survey shows that the revenue share of compound semiconductor substrates will grow at a compound annual growth rate of 17% between 2023 and 2029, reaching $3.3 billion. Driven by the growth of the automotive and power electronics consumer markets, SiC and GaN-on-Si are moving towards 200nm wafers; In the field of photonics, the 150nm InP market is also expanding, driven by the data communication market.
Although the current competitive landscape of the compound semiconductor industry is relatively fragmented, with the development of technology and the growth of market demand, it is expected that the industry concentration will gradually increase, and the market share of leading companies may further expand. The compound semiconductor industry is a highly competitive market, and international giants have increased R&D investment to compete for market share. At the same time, emerging companies are also constantly challenging the market landscape through technological innovation and differentiated competition strategies. In addition, governments around the world will continue to introduce policies to support the development of the semiconductor industry, and at the same time, with the rapid development of the industry, it is expected that more investment will flow to the field of compound semiconductors to promote industrial innovation and expansion. In China, the domestic substitution of key semiconductor equipment has become an inevitable trend. Domestic downstream chip manufacturers attach unprecedented importance to domestic equipment manufacturers, promoting the process of supply chain localization. Although the compound semiconductor industry has broad prospects, investors also need to pay attention to the risks of industrial policy, raw material supply, market competition and technological change. Sound investment strategies and risk management are essential for the healthy development of the industry.
