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$2.4B CS substrate market by 2027

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Market is growing at 16 percent CAGR, driven by power and photonics applications, says Yole Intelligence

Driven by power and photonics applications, the compound semiconductor substrates market will be worth close to $2.4 billion by 2027 growing at 16 percent CAGR between 2021 and 2027, according to Yole Intelligence's new 'Status of Compound Semiconductors Industry 2022' report.

CS has been adopted in many applications over the decades; more recently SiC and GaN in power, GaN and GaAs in RF, GaAs and InP in photonics, and LED and µLED in display, have gained momentum. As a result, the substrate and epiwafer markets are also expected to grow.

Poshun Chiu, senior technology and market analyst specialising in Compound Semiconductors and Emerging Substrates at Yole Intelligence, part of Yole Group said: “Wolfspeed is the leading SiC substrate and epiwafer supplier for Power SiC and RF GaN. As the larger-format substrate is the strategic resource in the next generation of device manufacturing, the opening of 8 inch wafer fabs and the expansion of material capacity illustrates the ambitious targets aimed at in the coming decade.”

Meanwhile, II-VI closed its acquisition of Coherent and renamed the company, thus illustrating its change of focus. Today, Coherent is the leading photonic device player as well as the leading SiC substrate supplier for power and RF applications. Moreover, it is working with SEDI on RF GaN device manufacturing and has entered the power SiC device business with GE. Both are strengthening their competitiveness from the substrate level to the device level.

AXT, Sumitomo Electric, Freiberger, and SICC are the leading suppliers of GaAs, InP, and semi-insulating SiC substrates. Their objectives of growing their revenues rely on expanding into other CS materials. Players are looking at the synergy between GaAs and InP substrates for RF, photonic, and µLED applications. Also, players from semi-insulating SiC are entering n-type SiC as it is a market with a higher growth rate.

Taha Ayari, technology and market analyst, Compound Semiconductor and Emerging Substrates, at Yole Intelligence said: “Epiwafer suppliers benefit from the different dynamics of the CS open epiwafer market. IQE has been involved in various CS markets (for example, RF GaAs and GaN), as the double-digit CAGRs of InP and GaAs photonics represent markets with both volume and scale. And µLED is a booming market, expected to double every year in the coming five years. VPEC has succeeded in becoming the largest supplier of RF GaAs epiwafer in the open market, and the company continues increasing its engagement in photonics for future growth”.

Ezgi Dogmus, Yole's team lead analyst in Compound Semiconductor & Emerging Substrates said: “With LEDs, handset power amplifiers, and telecom & datacom, compound semiconductor went through its first inflection point with GaAs and InP in the 1990s”.

As the demands for 5G connectivity, EVs, and fast chargers for smartphones come to the market, compound semiconductors will grow in both volume and market value says Yole. Looking into the future, e-mobility, including higher-voltage applications, sensing in various end-systems, the transition from 5G to 6G, and µLED displays will bring inflection points for different CS materials, along with more emerging substrates and new applications to come.

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