Global Market Size, Forecast, and Trend Highlights Over 2025-2037
Hardware Security Modules Market size was USD 1.7 billion in 2024 and is estimated to reach USD 5.5 billion by the end of 2037, expanding at a CAGR of 9.8% during the forecast period, i.e., 2025-2037. In 2025, the industry size of hardware security is evaluated at USD 1.8 billion.
The rare earth elements are critical materials of hardware security modules, as they are used in high-grade semiconductors and component manufacturing, such as assembly, integrators, and cryptographic processors. Considering this factor, the extraction of rare earth elements and transition metals is estimated to have a potential influence on the cost of hardware security modules. In 2023, the U.S. Geological Survey (USGS) stated that the extraction of the rare earth elements crossed 299,000 metric tons. The same source also underscores that China leads the extraction with more than 69.5% of refining capacity. Furthermore, the U.S. Bureau of Labor Statistics (BLS) states that in the fourth quarter of 2024, the producer price index (PPI) for electronic components grew by 5.5% YoY.
The consumer price index (CPI) increased by 1.9% for IT hardware in 2024, and represented a stable pricing and positive adoption growth. The steady rise in strategic investments from governments is opening avenues for innovations in the hardware security modules and their components. For instance, in 2024, the National Institute of Standards and Technology (NIST) stated that it invested around USD 12.4 million in the manufacturing of cryptographic hardware solutions. Further, North America and Europe are set to lead the assembly operations during the foreseeable period. The U.S. Department of Commerce (DOC) estimates that the domestic production of cryptographic hardware systems rose by 12.4% in 2024. The positive growth in the import export activities is also backing the sales of hardware security modules (HSM).
