 Market overview.webp)
Vertical Cavity Surface Emitting Lasers (VCSEL) Market size was valued at USD 2.11 billion in 2024 and is expected to reach USD 20.47 billion by 2037, expanding at around 19.1% CAGR during the forecast period i.e., between 2025-2037. In the year 2025, the industry size of vertical cavity surface emitting lasers is assessed at USD 2.8 billion.
The primary factor projected to boost the market demand is the growing number of data centers. Around the globe, there are about 7,999 data centers. Of those, approximately 32% of the data centers are situated in the US. In data centers, multimode fiber (MMF)-based optical communications are primarily powered by vertical-cavity surface-emitting lasers (VCSELs).
Moreover, VCSELs are utilized in optical communication technologies, similar to other lasers. They are perfect for optical communication owing to their features, which include a circular beam form, a wide free spectral range, and massive and continuous tuning. Additionally, a range of VCSEL applications, including high bandwidth, would be seen in this field since communication technologies have a promising future and must develop.
Growth Drivers
Challenges
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Base Year |
2024 |
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Forecast Year |
2025-2037 |
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CAGR |
19.1% |
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Base Year Market Size (2024) |
USD 2.11 billion |
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Forecast Year Market Size (2037) |
USD 20.47 billion |
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Regional Scope |
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Application (Telecom, Consumer Electronics, Automotive, Medical, Industrial, Aerospace & Defense)
The consumer electronics segment in the vertical cavity surface emitting lasers market is projected to generate the highest revenue by 2037. One important sector for 3D sensing applications is consumer electronics. The primary cutting-edge technology that provides sophisticated illumination sources for optical sensing is VCSEL technology. VCSEL laser arrays are advantageous for camera autofocus and 3D sensor systems in smartphones and tablets.
Type (Multi-mode VCSEL, Single-mode VCSEL)
The multi-mode vertical cavity surface emitting lasers market is poised to have significant growth during the forecast period, due to the huge power densities that these vertical-cavity surface-emitting lasers are capable of with a brief rise time. Thus, their application is becoming more widespread in LiDAR, time-of-flight (TOF), lighting, industrial, and other high-power applications. Also, owing to their small size, multimode VCSELs are perfect for use in highly integrated sensors and are preferable for mobile consumer applications.
Our in-depth analysis of the global market includes the following segments:
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Type |
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Material |
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Application |
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APAC Market Statistics
Asia Pacific industry is expected to account for largest revenue share by 2037, backed by the domination of manufacturing of semiconductors, and smartphones in this region. Many of the multinational smartphone businesses are based in this area.
Countries such as India, Vietnam, and Thailand among others, are seeing an increase in the number of smartphone and consumer electronics manufacturers establishing manufacturing units in the region. The region's demand for VCSELs is also rising as a result of organic electronic fabrication in the burgeoning economies there.
North American Market Forecast
The North America vertical-cavity surface emitting lasers market is slated to have significant growth between 2025 and 2037, on account of the rising adoption of IoT.
IoT connections are projected to cross approximately 4 billion by 2025, in North America. Hence, in order to avoid the data traffic, the construction of data centers is growing further, increasing demand for vertical-cavity surface-emitting lasers.
 Market size.webp)
Author Credits: Abhishek Verma
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