System-On-Chip Market Size 2024-2028 

The system-on-chip market size is estimated to grow by USD 5.7 billion at a CAGR of 4.46% between 2023 and 2028. The market is experiencing significant growth, driven by several key trends and factors. One major trend is the increasing adoption of SoCs in robotics and automation, as these technologies require high processing power and low power consumption. Another trend is the surge in 5G investments, as SoCs play a crucial role in enabling the fast data processing and low latency required for 5G networks. Additionally, SoC vendors are increasingly relying on IP core providers to reduce time-to-market and improve product differentiation. These factors are expected to fuel the growth of the SoC market in the coming years, making it an exciting space for innovation and investment.

What will be the Size of the Market During the Forecast Period?

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Market Dynamic and Customer Landscape

The market encompasses integrated circuits that contain all essential components of a computer or other digital system on a single chip. These components include Digital, Analog, Mixed signal, Radio frequency, CPU, System memory, Peripheral controllers, GPUs, Specialized neural networks, Radio modems, Multi-chip systems, and Power management systems. SoCs are utilized in various applications such as IT, telecommunication, laptops, Macs, iPads, database management, fraud detection systems, cybersecurity, and more. Power consumption and efficiency are critical factors in the SoC market, as energy waste leads to increased costs. Processor types range from CPUs to GPUs, and advanced features like embedded graphics and signal processing enhance their functionality. The market is dynamic, with continual advancements in technology driving innovation in areas like energy efficiency, performance, and integration of new features. Our researchers analyzed the data with 2023 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.

Key Market Driver

Growing adoption of SoCs in robotics is notably driving market growth. The market is experiencing significant growth due to the increasing integration of advanced technologies in various industries. In consumer electronics, the adoption of SoC technology is prevalent in smart wearables such as fitness bands and smartwatches, Bluetooth devices, and premium smartphones. The semiconductor market is also witnessing growth in the aerospace and defense sector, where SoCs are used in the development of complex systems requiring high processing power and memory. Moreover, the digital healthcare sector is leveraging SoCs for the development of medical devices and digital healthcare solutions. The Internet of Things (IoT) is another area where SoCs are extensively used due to their small form factor, low power consumption, and high processing capabilities.

Furthermore, in the telecommunications industry, the shift towards 5G and 6G networks and non-terrestrial networks is driving the demand for advanced SoCs. Companies such as Ericsson, IIVI Incorporated, GlobalFoundries, Silicon Storage Technology, and STMicroelectronics are at the forefront of developing SoCs for these applications. Furthermore, the automotive industry is witnessing a surge in the adoption of electric vehicles, leading to an increased demand for AI chips and Edge AI chips to enhance vehicle performance and safety. SoCs are integral to the design of these chips, making them a crucial component of the automotive electronics industry. In summary, the market is witnessing significant growth across various industries, including consumer electronics, healthcare, automotive, telecommunications, and military and defense. SoCs are essential in enabling advanced technologies such as 5G, AI, and robotics, making them a critical component of future technologies. Thus, such factors are driving the growth of the market during the forecast period.

Significant Market Trends

Increase in 5G investments is the key trend in the market. The market is witnessing significant growth, particularly in the area of System-on-Chip (SoC) technology, driven by the increasing adoption of 5G communication technology. With 5G's commercialization, data transfer speeds of up to 10,000 Mbps are expected. This technology is gaining traction across various industries, including consumer electronics, aerospace, defense, and digital healthcare. Investments in 5G infrastructure have been increasing rapidly, with the worldwide revenue reaching USD19.1 billion in 2021, up from USD13.7 billion in 2020. This growth is fueling the demand for advanced electronic components and modules such as 5G mm Wave antenna modules, multimode modems, base stations, and RF products.

Furthermore, to capitalize on this trend, SoC vendors like Ericsson, IIVI Incorporated, GlobalFoundries, Silicon Storage Technology, and STMicroelectronics are releasing products that support 5G technology. These SoCs cater to various application segments, including smart wearables like fitness bands and smartwatches, Bluetooth devices, premium handsets, intelligent speakers, electric vehicles, and AI and edge AI chips. Moreover, the Internet of Things (IoT) and non-terrestrial networks are also expected to contribute to the growth of the SoC market. As 5G expands beyond terrestrial networks to include 5G Compact Macro and baseband units, the demand for advanced SoCs will continue to increase. Thus, such trends will shape the growth of the market during the forecast period.

Major Market Challenge

Dependency of SoC companies on IP core providers is the major challenge that affects the growth of the market. The integration of semiconductor Intellectual Property (IP) blocks from third-party vendors into System-on-Chips (SoCs) is a complex process for semiconductor manufacturers. With advancements in technology, there is a growing trend among vendors to acquire new technologies and IP rights to develop high-performance SoCs for various applications. However, integrating these IP blocks into SoCs comes with its own set of challenges. Design engineers face significant difficulties in ensuring seamless integration of the acquired IP blocks, especially when dealing with a large number of IP blocks. The risks and design complexity increase with each IP block added, leading to a substantial increase in the total cost of IP acquisition.

Furthermore, in the consumer electronics sector, SoC technology is extensively used in smart wearables such as fitness bands and smartwatches, Bluetooth devices, handsets, premium smartphones, intelligent speakers, and electric vehicles. The semiconductor market for SoCs is also expanding in other industries like aerospace, defense, and digital healthcare. In the telecommunications sector, 5G and future 6G networks, non-tererritorial networks, baseband units, and 5G compact macro are driving the demand for advanced SoCs. Key players in the SoC market include Ericsson, IIVI Incorporated, GlobalFoundries, Silicon Storage Technology, and STMicroelectronics. These companies are investing heavily in research and development to create high-performance SoCs with advanced features such as AI chips, edge AI chips, and memory, input, and output ports for secondary storage. The SoC market is expected to grow significantly due to the increasing demand for connected devices and the integration of advanced technologies like 5G and the Internet of Things. Hence, the above factors will impede the growth of the market during the forecast period

Key Market Customer Landscape

The market forecasting report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their market growth analysis strategies.

 Customer Landscape

Key Companies & Market Insights

Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.

Apple Inc. - The company offers system-on-chip that includes M1 Ultra chip which provides 2.5TBps of bandwidth between the two dies, which allows the Ultra to be recognized as a single SoC by macOS. 

The market research and growth report also includes detailed analyses of the competitive landscape of the market and information about key companies, including:

• Analog Devices Inc.
• Apple Inc.
• Broadcom Inc.
• Huawei Technologies Co. Ltd.
• Infineon Technologies AG
• Intel Corp.
• MediaTek Inc.
• Microchip Technology Inc.
• NVIDIA Corp.
• NXP Semiconductors NV
• Qualcomm Inc.
• Samsung Electronics Co. Ltd.
• STMicroelectronics International N.V.
• Taiwan Semiconductor Manufacturing Co. Ltd.
• Texas Instruments Inc.
• Toshiba Corp.

Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.

Market Segmentation

By Application 

The Consumer electronics segment is estimated to witness significant growth during the forecast period. The System-on-Chip (SoC) market encompasses the design, development, and integration of various digital, analog, and mixed signal components, including CPU, system memory, peripheral controllers, GPUs, specialized neural networks, radio modems, and power management systems, onto a single integrated circuit (IC). 

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The Consumer electronics segment was the largest segment and was valued at USD 9.10 billion in 2018. This trend is driven by the increasing demand for energy-efficient electronic devices, such as smartphones, laptops, tablets, consumer appliances, and IT infrastructure, which require high-performance computing capabilities and wireless communication for AI, database management, fraud detection systems, cybersecurity, and telecommunication applications. SoCs employ multi-core technologies and embedded graphics to enhance processing power and energy efficiency. For instance, Macs and iPads use custom-designed Apple chips, while 5G technology and Internet of Things (IoT) devices leverage SoCs with integrated radio frequency (RF) components for wireless communication. Power consumption and efficiency remain critical concerns, with innovations in low-power processing and signal processing techniques to minimize energy waste. The SoC market is further propelled by advancements in multi-chip systems, radio frequency (RF) systems, and AI computing activities, such as machine learning and deep learning algorithms. This growth is expected to continue, with the increasing adoption of 5G technology, AI, and energy-efficient electronic devices, as well as the integration of specialized neural networks and GPUs for advanced computing tasks.

By Region

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APAC is estimated to contribute 64% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period.

The System-on-Chip (SoC) market encompasses the design, development, and integration of various digital, analog, and mixed signal components, including CPU, system memory, peripheral controllers, GPUs, specialized neural networks, radio modems, and power management circuits, onto a single integrated circuit (IC). SoCs are increasingly utilized in energy-efficient electronic devices, such as 5G technology-enabled smartphones, laptops, tablets, smart appliances, and IT infrastructure, including AI computing activities, database management, fraud detection systems, cybersecurity, and telecommunication networks. Multi-core technologies and embedded graphics have become essential components of modern SoCs, enabling advanced computing capabilities in Macs, iPads, and other consumer electronics. Power consumption and efficiency are critical factors driving the development of SoCs for wireless communication applications, including radio frequency (RF) and 5G technologies. Moreover, SoCs are essential for energy-efficient AI and machine learning applications, such as those used in IoT devices and edge computing. The SoC market is expected to grow significantly due to the increasing demand for energy-efficient and powerful ICs in various applications, including wireless communication, computing activities, and energy-efficient electronic devices. The integration of multi-chip systems and the adoption of advanced technologies, such as GPUs and specialized neural networks, are expected to further fuel market growth. However, the high costs and energy waste associated with the production of SoCs remain significant challenges for market participants.

Segment Overview

The market research report provides comprehensive data (region-wise segment analysis), with forecasts and estimates in "USD billion " for the period 2024-2028, as well as historical data from 2018-2022 for the following segments.

• Application Outlook
  • Consumer electronics
  • IT and telecommunication
  • Automotive
  • Others

• Region Outlook 
  • APAC
    • China
    • India
  • North America
    • The U.S.
    • Canada
  • Europe
    • The U.K.
    • Germany
    • France
    • Rest of Europe
  • South America
    • Brazil
    • Argentina
    • Chile
  • Middle East & Africa
    • Saudi Arabia
    • South Africa
    • Rest of the Middle East & Africa

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Market Analyst Overview

The System-on-Chip (SoC) market encompasses the design, development, and integration of various functionalities onto a single semiconductor chip. This includes digital, analog, mixed signal, radio frequency, CPU, system memory, peripheral controllers, GPUs, specialized neural networks, radio modems, multi-chip systems, and power management components. SoCs are essential for energy-efficient electronic devices, such as smartphones, laptops, consumer appliances, tablets, and IT infrastructure like servers, databases, fraud detection systems, cybersecurity, and telecommunication equipment.

Furthermore, with the advent of 5G technology and the Internet of Things (IoT), the SoC market is witnessing significant growth. Multi-core technologies, embedded graphics, and AI computing activities are becoming increasingly important in SoC designs. IC manufacturers like Macs and iPads utilize advanced SoCs for enhanced performance and power efficiency. Power consumption and efficiency are critical factors in SoC design, as energy waste leads to increased costs. Signal processing and wireless communication are also key applications for SoCs, enabling faster data transfer and real-time processing.

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What are the Key Data Covered in this Market Report?

• CAGR of the market during the forecast period
• Detailed information on factors that will drive the market growth and forecasting of the market between 2024 and 2028
• Precise estimation of the size of the market size and its contribution to the parent market
• Accurate predictions about upcoming market trends and analysis and changes in consumer behavior
• Growth of the market industry across Europe, North America, APAC, South America, and Middle East and Africa
• Thorough market growth analysis of the market’s competitive landscape and detailed information about companies
• Comprehensive market analysis and report on the factors that will challenge the market research and growth of market companies