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July 2025
The global aerospace semiconductor market size accounted for USD 7.73 billion in 2025 and is forecasted to hit around USD 15.52 billion by 2034, representing a CAGR of 8.06% from 2025 to 2034. The North America market size was estimated at USD 2.86 billion in 2024 and is expanding at a CAGR of 8.20% during the forecast period. The market sizing and forecasts are revenue-based (USD Million/Billion), with 2024 as the base year.
The global aerospace semiconductor market size was calculated at USD 7.15 billion in 2024 and is predicted to increase from USD 7.73 billion in 2025 to approximately USD 15.52 billion by 2034, expanding at a CAGR of 8.06% from 2025 to 2034. The market is expanding due to increasing air traffic, a rise in defense and military spending for its advancements, along with the unparalleled benefits of the semiconductor devices.
Artificial intelligence is highly impacting the semiconductor industry in terms of chip designing, testing processes, along manufacturing. AI-based tools can enhance chip performance and optimize the manufacturing process, which offers highly efficient and reliable semiconductor chips that can be applicable to the aerospace sector. AI can further support the aerospace semiconductor market by machine learning algorithms, where ML algorithms use data like design history, materials, and performance criteria, and provide patterns for chip design with the help of the correlation between design variables and performance results.
AI algorithms can generate various iterations under specific criteria, and rigorous evaluation is performed to test mechanical properties like aerodynamics performance and structural integrity. With the help of these refinery processes, AI algorithms offer optimal solutions. In a nutshell, AI is being used to revolutionize semiconductor chip design by accelerating the discovery of new materials and methods for efficient chip production that can be used for aerospace applications.
The U.S. aerospace semiconductor market size was exhibited at USD 2.43 billion in 2024 and is projected to be worth around USD 5.37 billion by 2034, growing at a CAGR of 8.25% from 2025 to 2034.
Which are the major factors driving the North America aerospace semiconductor market?
North America held the largest market share of nearly 40% in 2024 due to substantial investment by the government to establish an aerospace industry with cutting-edge technologies and advanced systems. The region boasts a highly established aerospace sector due to space giants like NASA and SpaceX, with various space-tech startups further supporting the market growth in the region. The U.S. government invests substantially in military and defense by keeping the nation’s security as a priority.
Moreover, North America has stringent aerospace safety and quality regulations that enable semiconductor manufacturers to follow these rules and offer highly reliable and well-performing semiconductor products. Collaborations between government agencies, and private sector, and academic institutes to establish and innovate products related to the aerospace sector are further boosting the market growth in the region.
Asia Pacific is expected to witness the fastest CAGR during the forecasted years of 2025-2034. The region is experiencing a significant growth rate and holds potential to further expand globally due to a couple of leading factors, such as an increased rate of air travel, growing military modernization by emerging economies to stay safe and competitive on the global platform. This is creating huge demand for semiconductor components that can be used in avionics, communication systems, and other crucial systems of aircraft, also due to the increasing rate of digitalization.
The integration of technologies like 5G, IoT, which are the foundation of industry 4.0, in major Asian countries like India, China, and Japan driving the demand for advanced semiconductor components. Additionally, countries like Taiwan, China, and India are forefront in the production of semiconductor chips with leading key players that are well established with robust infrastructure that supports highly reliable and high-quality semiconductor components.
The aerospace semiconductor market encompasses semiconductor devices specifically designed, manufactured, and tested for use in aerospace and defence systems. These components are critical for high-reliability, high-performance, and radiation-hardened applications in avionics, satellites, aircraft systems, UAVs, and space exploration. Aerospace semiconductors typically adhere to stringent environmental, durability, and safety standards (e.g., MIL-STD, RTCA DO-254, NASA standards) and include a wide range of analogue, digital, mixed-signal, and power devices.
| Report Coverage | Details |
| Market Size by 2034 | USD 15.52 Billion |
| Market Size in 2025 | USD 7.73 Billion |
| Market Size in 2024 | USD 7.15 Billion |
| Market Growth Rate from 2025 to 2034 | CAGR of 8.06% |
| Dominating Region | North America |
| Fastest Growing Region | Asia Pacific |
| Base Year | 2024 |
| Forecast Period | 2025 to 2034 |
| Segments Covered | Component Type, Functionality, Platform, Material Type, Technology Node, Appliction, End User, and Region |
| Regions Covered | North America, Europe, Asia-Pacific, Latin America, and Middle East & Africa |
Smart Defence solution with military modernization
A significant driving factor for the expansion of the aerospace semiconductor market is the need for advanced Defence systems amid growing geopolitical tensions and a country's internal issues. Semiconductor devices are highly in demand for RADAR systems, UAVs, and other military applications related to aerospace programs. Growing shift towards autonomous drones, network battlefield systems, along with smart defence solutions for precise outcomes and safety needs, semiconductors with high performance, which enable aircraft to work even in extreme conditions and handle complex tasks efficiently. Government regulations are further supporting to modernization of the defence sector by various initiatives, programs, and substantial funding is further propelling the market growth.
Cyclical changes of the market
The aerospace semiconductor market is frequently witnessing a boom-and-bust cycle for the semiconductor supply chain every 5 years. Oversupply is created by extreme demand in a particular time frame of these years, causing a precipitous crash that has long been noticed in the semiconductor industry. This cyclical impact has been noticed broadly in the past two years, along with chip shortages. Every part of the global semiconductor supply chain has been affected by this cycle of boom and bust, which can further destabilize the reliability of the supply chain by minimizing supply and increasing risks for sourcing, is increases due to such cyclical changes.
Increasing space exploration by leading countries
One of the significant opportunities that the aerospace semiconductor market holds is increasing space exploration missions by different countries, including government-backed missions and private company-led initiatives, further driving the demand for semiconductor components that can handle the extreme conditions in outer space, which is completely different from Earth’s climate. Exposure to high radiation, solar flares, and highly cold temperatures in some regions of space requires high tensile material that can withstand such extreme temperature differences in temperatures. Moreover, semiconductor-based components offer reliable communication between spacecraft and Earth stations even over a vast distance, which is a vital part of space exploration.
Why do microprocessors play a vital role in the aerospace semiconductor market?
The microprocessors segment led the market due to the vital role of microprocessors in various aircraft systems such as flight control, communication, and navigation systems. Microprocessors perform signal processing from sensors that monitor parameters like altitude, speed, and direction for controlled flight. Microprocessors also power the radio equipment and communication systems of aircraft, from commercial to military purpose satellites and deep space probes, showcasing their dominance and importance in the global market.
The power devices segment is expected to witness the fastest CAGR during the forecasted years of 2025-2034. The segment is expanding due to growing demand for lightweight and energy-efficient solutions, the need for high-frequency and high-efficiency power converters, and semiconductor devices enable advanced electronics systems to contribute to these goals.
What is offered by radiation-hardened technology in the aerospace semiconductor market?
The radiation-hardened segment held the largest market share of nearly 40% in 2024. The segment is dominant as it offers electronic components that are highly resistant to the damage caused by radiation from outer space and extreme environments. This can be applicable for various aerospace-related programs like space exploration, nuclear power plants, military defense programs, and satellites. Such a mission requires highly stable electronic systems. Also, various satellites that are orbiting Earth are highly dependent on radiation-hardening technology, showcasing their dominance in the market.
The radiation-tolerant segment is expected to witness the fastest CAGR during the forecasted years of 2025-2034. The segment is expanding due to radiation-tolerant components offering affordability to use instead of radiation-hardening components, due to their expensive nature. Thus, various space missions and satellite constellations are using radiation-tolerant technology to withstand extreme temperature changes.
Why are commercial aircraft witnessing higher demand in the global market?
The commercial aircraft segment held the largest market share of nearly 38% in 2024. The segment is dominating due to various factors including, increasing air traffic for travelling in emerging countries, active fleet expansion and modernization of its infrastructure by airlines, adoption of advanced technologies that relies majorly on semiconductors along with the expansion of e-commerce and requirement of an efficient cargo transport system, which creates increasing demand for upgraded aircraft with stable systems.
The satellites segment is expected to witness the fastest CAGR during the forecasted years of 2025-2034. The segment is witnessing a significant growth rate due to increasing demand for satellite-based communication systems and commercial applications like telecommunication, earth observation, and navigation further increases demand for semiconductor components.
Why is silicon material frequently used in the aerospace semiconductor market?
The silicon segment held the largest market share of nearly 60% in 2024. Silicon material is well suited for different aerospace applications like avionics, power electronics, and communication systems due to its versatility, cost effectiveness, and established manufacturing processes. Also, silicon is abundantly available in nature, making it highly cost efficient, and it has characteristics like thermal stability with high resistance to greater temperature fluctuations, and it can also be precisely dope to alter its electrical properties. This enables various electronic components like diodes, transistors, and integrated circuits to be created.
The gallium nitride segment is expected to witness the fastest CAGR during the forecasted years of 2025-2034. The segment is expanding due to the wide band gap of gallium nitride, which presents increased power efficiency, and devices with gallium nitride showcase superior electron mobility that offers higher switching speeds and minimized power losses.
Why are 45-55nm nodes used mainly in the aerospace semiconductor market?
The 45-65 nm segment held the largest market share of nearly 33% in 2024. The segment is dominating as these nodes are considered as mature nodes, as they have been used for a longer period in production, and they are highly established for infrastructure and manufacturing processes. This Technology node reduces the chances of unexpected issues with performance and leads to more reliable supply chains. These nodes can be applicable for navigation systems, avionics, and other communication systems as well.
The <28 nm segment is expected to witness the fastest CAGR during the forecasted years of 2025-2034. The segment is expanding due to its ability to work in compact areas without compromising on performance, along with low power consumption. These nodes allow integration of maximum transistors with smaller chip area, leading to efficient performance of the systems.
Why does the avionics system play a crucial role in the aerospace semiconductor market?
The avionics systems segment held the largest market share of nearly 35% in 2024. The Avionics system plays a crucial role in modern aircraft manufacturing, as it includes communication, navigation, display systems, and flight control, which are highly dependent on semiconductor components. Also, stringent safety regulations, by looking at the increasing air traffic, have become mandatory to follow by the aerospace sector to avoid accidents or mid-air system failures. Thus, the increasing complexity of avionics systems requires specialized semiconductor components for their ease of functionality.
The satellite payloads segment is expected to witness the fastest CAGR during the forecasted years of 2025-2034. The segment is expanding due to increasing government initiatives for satellite launches for environmental monitoring, disaster management by its early detection, earth observation and imaging techniques, weather forecasting, and various other applications, which increase investment in satellite payloads.
The OEMs segment held the largest market share of nearly 50% in 2024. The dominance of the OEMs segment is attributed to the various factors where OEMs offer high-quality equipment capable of handling harsh climatic changes. OEMs are best known for their thorough quality control measures and commitment to following industry standards, making them ideal for the aerospace semiconductor industry. Also, aerospace applications often require meeting unique specifications of various products and performance, where customization is necessary system that is offered by OEMs effectively.
The space agencies segment is expected to witness the fastest CAGR during the forecasted years of 2025-2034. Space agencies like NASA, ISRO, SpaceX, and others require advanced semiconductor components with features like radiation hardening and stability in extreme temperatures. These are highly crucial to achieve maximum success rate in highly vulnerable space missions.
By Component Type
By Functionality
By Platform
By Material Type
By Technology Node
By Application
By End User
By Region
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