Compound semiconductors are formed when two or more elements from separate or the same group on the periodic table are brought together and combined. Due to the increased demand for applications on electronic and mobile devices, it has experienced phenomenal growth over the past few years. Various deposition techniques, including chemical vapor deposition, atomic layer deposition, and others, are utilized in the compound semiconductor manufacturing process.
Compound semiconductors will be in high demand in the future due to their enhanced resistance to high temperatures, increased frequency, wider band gap, and quicker operation. It is anticipated that compound semiconductors will continue to be in high demand. These distinguishing characteristics of compound semiconductors will be among the factors propelling demand in the future. A large number of providers are concentrating on the development of new technologies for compound semiconductor products as well as the production of competitively priced application-specific goods.
According to Straits Research, “The global compound semiconductor materials market size was valued at USD 35.96 billion in 2024 and is projected to reach from USD 38.11 billion in 2025 to USD 60.75 billion by 2033, growing at a CAGR of 6% during the forecast period (2025-2033).” The global semiconductor industry is expanding due to the demand for electronic devices. Semiconductors are the driving force behind technological innovation and advancement, with semiconductor packages and surface mount technology procedures comprising the majority of mainstream electronics. Deposition of thin films, prototyping, selective etching, and modification are some of the phases of manufacturing microelectronic devices. On a single wafer, generating hundreds of circuits containing hundreds of millions of functional components by varying parameters and patterns is possible.
Physical vapor deposition processes, such as sputtering and evaporation, provide durable, wear-resistant coatings on semiconductors before their installation in end-user devices. The global expansion of the semiconductor industry is anticipated to be driven by several significant trends. One such trend is the increasing use of artificial intelligence (AI) across various industries, which presents growth opportunities for semiconductor manufacturers and suppliers.
Potential GaN application in 5G infrastructure Creates Tremendous Opportunities
5G wireless networks must utilize base stations that combine technologies that offer efficiency, performance, and cost-effectiveness. GAN solutions are an absolute necessity for providing these characteristics to the customer. GAN-on-SIC provides 5G base stations with significant increases in both efficiency and performance when compared to Laterally Diffused Metal-Oxide Semiconductors (LDMOS). In addition, GAN-on-SIC has enhanced thermal conductivity, exceptional durability and dependability, higher efficiency at higher frequencies, and comparable performance in a miniature MIMO array. GAN is expected to enhance power amplifiers for all network transmission cells (micro, macro, pico, and femtohm/home routers). Consequently, GAN could significantly impact the subsequent generation of 5G deployment.
Regional Analysis
Asia-Pacific is the most significant global Compound Semiconductor Materials market shareholder and is estimated to exhibit a CAGR of 4.6% over the forecast period. The consumer electronics market in Asia-Pacific countries, including China, India, Japan, Indonesia, and Malaysia, is experiencing high penetration due to technologically advanced products. Rapid urbanization and rising disposable income are expected to expand consumer electronics users further, promoting the scope of compound semiconductor materials.
Additionally, technological developments, such as the miniaturization of smartphones, TVs, laptops, and air conditioners, are driving the industry. Government initiatives in India, the largest producer of household appliances, are also boosting the market. The demand for compound semiconductor materials for major appliances, such as refrigerators, washing machines, and air conditioners, is expected to grow. The manufacturing sector in the region is influenced by low labor costs, land availability, and high domestic demand, attracting foreign manufacturers to invest in the manufacturing sector.
North America is anticipated to exhibit a CAGR of 3.3% over the forecast period. Expanding the end-use industries in the United States, Canada, and Mexico drives the demand for compound semiconductor materials in the region. Moving closer to the area, foreign manufacturers must expand their target markets, encouraging capacity growth and acquisitions. For instance, the Canadian company Solantro Semiconductor was purchased by Huada Semiconductor, a Chinese market leader in industrial semiconductor solutions. Advanced integrated circuits are being developed by Solantro Semiconductor using silicon and other compound semiconductor materials. The goal of the acquisition was to increase investment in the company, benefit from the availability of technology in the area, and broaden its presence in North America.
Furthermore, the area is also experiencing capacity increases; in Champaign, Illinois, II-VI EpiWorks opened an addition to its center of manufacturing excellence. The plant produces epitaxial wafer products for compound semiconductor fabrication. The goal of this expansion is a four-fold increase in production.
