In 2024, the overall semiconductor device industry reached roughly $670B. Although the compound semiconductor remains a small fraction of the overall market, the CS device market is projected to reach approximately $25B by 2030, with a robust CAGR of 13%. This growth is primarily driven by the automotive and mobility markets, with significant contributions from the telecom & infrastructure and mobile & consumer sectors.

The automotive & mobility and telecom & infrastructure markets are currently driven by two major trends: automotive electrification/ADAS and artificial intelligence (AI), respectively. These trends are expected to push the CS market to a double-digit CAGR over the next five years. In the automotive sector, the rise of electric vehicles (EVs) is accelerating the adoption of SiC-based power devices, while GaN-based power devices are gaining traction in DC/DC converters, onboard chargers (OBCs), and LiDAR. In photonics, ADAS is driving faster adoption of automotive LiDAR, increasing demand for CS-based lasers. Whether GaAs VCSEL or SiPh will dominate the laser market in the future remains to be seen, but the sector is set to experience rapid growth. As a result, the automotive CS market is growing at a 22% CAGR from 2024 to 2030 despite the global slowdown in the Automotive market.

Turning to telecom & infrastructure, AI has been the dominant topic for at least two years, significantly driving data center growth at multiple levels. At the CS level, InP EELs, GaAs VCSELs, and power GaN devices are playing a crucial role in making data centers high-performing, and energy-efficient—essential requirements for AI workloads. One question remains: how big is AI’s impact on CS? Additionally, the 5G rollout has increased the demand for RF GaN power amplifiers (PAs). Led by photonics and RF applications, the telecom & infrastructure CS market is growing at a 9% CAGR from 2024 to 2030.

Finally, the mobile & consumer market is expected to grow at a 7% CAGR from 2024 to 2030, driven by the adoption of GaN-based fast charging and GaAs-based photonics and RF applications in smartphones and wireless communications.

Beyond these major markets, industrial, aerospace, and medical sectors will also experience significant CS adoption. By 2030, these industries are expected to contribute to both double- and single-digit CAGRs, respectively, with power and photonics applications fueling growth. With accelerating demand across multiple industries, the compound semiconductor market is poised for sustained expansion, playing a vital role in enabling the next generation of advanced technologies.

By 2025, the semiconductor industry will be evolving, with increasing interest in compound technologies. The rise of SiC has driven major investments, while GaN is gaining traction in power and RF applications. Companies like Infineon and Global Foundries are exploring synergies to optimize production. RF GaAs remains dominant in consumer applications but faces geopolitical challenges. RF GaN, initially developed for defense, is now key in 5G and satellite communications. The photonics market is expanding, driven by AI and datacom growth, with InP and GaAs players strengthening collaborations. Meanwhile, the microLED display industry remains fragmented, with major display makers securing LED suppliers and startups driving innovation. Despite Apple’s withdrawal, microLEDs continue to gain momentum, with companies still investing in their future. As the compound semiconductor supply chain continues to evolve, strategic collaborations and geopolitical shifts will shape the industry's next phase of growth.

Compound semiconductors are advancing across multiple domains to meet next-generation system requirements, focusing on efficiency, power density, and integration. SiC continues to dominate high-voltage applications, scaling from 150mm to 200mm wafers for improved cost efficiency and scalability, while GaN expands into automotive and industrial markets with developments in higher voltage ratings and new packaging solutions. RF GaN is evolving to enhance efficiency and power density, with GaN-on-Si gaining traction for integration and cost-effectiveness, while InP is expected to emerge for future THz applications. Optical communication is pushing GaAs and InP to higher data rates, while microLEDs face ongoing challenges in mass production and efficiency. As materials, design, and fabrication technologies evolve, compound semiconductors are driving the next wave of performance improvements across critical applications.