Laser Diode Market Report 2025

The laser diode market size has grown rapidly in recent years. It will grow from $8.57 billion in 2024 to $9.55 billion in 2025 at a compound annual growth rate (CAGR) of 11.4%. The growth in the historic period can be attributed to telecommunications demand, consumer electronics, medical applications, industrial and manufacturing application, automotive lidar systems.

The laser diode market size is expected to see rapid growth in the next few years. It will grow to $14.66 billion in 2029 at a compound annual growth rate (CAGR) of 11.3%. The growth in the forecast period can be attributed to 5g and data centers, defense and security, miniaturization and consumer electronics, energy efficiency and cost competitiveness, environmental monitoring. Major trends in the forecast period include integration in augmented reality and virtual reality, shift towards green technology, R&D in advanced materials, environmental sensing and monitoring.

The growing demand in the electric vehicle (EV) automotive industry is projected to drive the growth of the laser diode market in the coming years. Electric vehicles are powered by motors that utilize electricity stored in batteries. Furthermore, the push for COVID-19 safety measures and the goal of achieving net-zero emissions have led to a surge in the adoption of EVs and hybrid vehicles. Laser diodes, which are optoelectronic devices that convert electricity into high-intensity coherent light, play a crucial role in these vehicles, thereby increasing demand. For instance, in November 2023, the U.S. Energy Information Administration, a government agency, reported that the share of battery-electric vehicles (BEVs) in new light-duty vehicle sales reached 17.7% in the third quarter of 2023, with BEVs representing 16% of total new vehicle sales for the year so far. This marks an increase from 12.5% in 2022 and 9% in 2021, as highlighted by Wards Intelligence. This data illustrates a significant upward trend in the demand for electric vehicles, indicating growing consumer preference and market expansion. Thus, the increasing demand for electric vehicles is fueling the growth of the laser diode market.

The laser diode market is projected to experience substantial growth driven by increasing demand from the aerospace and defense industry. This broad sector includes the production of both military and civilian aircraft, as well as their associated components. Laser diodes are widely utilized in this industry, mainly serving as pump sources for solid-state systems. For example, the International Trade Administration reports that the UK commercial space industry is expanding rapidly, achieving a turnover of over $22 billion in 2022, with aspirations to capture 10% of the global space market by 2030. The ongoing demand from the aerospace and defense sector is expected to be a significant driver for the laser diode market.

A prominent trend in the laser diode market is the emphasis on product innovations by major industry players. Companies are investing in cutting-edge solutions to enhance the capabilities of laser diodes. For example, Lumentum Holdings Inc., a leading player in the laser diode market, introduced the FemtoBladeTM femtosecond laser system in April 2022. This innovative system boasts a modular architecture that delivers high power at elevated repetition rates, offering increased flexibility, faster processing speed, and higher throughput for applications such as OLED, PCB, ceramic and glass cutting, engraving, and solar cell processing. The FemtoBlade's field-replaceable non-linear optics unit is a distinct feature that significantly reduces downtime.

Major companies in the laser diode market are focusing on innovative solutions such as the pump laser diode. This semiconductor device employs electrical current to drive lasing action in a solid-state laser gain medium, such as a neodymium-doped YAG crystal. Coherent Corp, a notable semiconductor manufacturing company, launched a next-generation pump laser diode in June 2023. This cutting-edge pump laser diode stands out with handheld fiber laser welding technology, achieving a remarkable 65 W of output power, surpassing existing products by 30%, all while requiring less operational current.

In January 2024, BluGlass Limited, an Australian semiconductor manufacturer known for its advanced custom laser and LED products, acquired GaNWorks Foundry, Inc. This acquisition aims to boost production efficiency, enhance quality control, reduce costs, and solidify BluGlass's position in the expanding gallium nitride (GaN) market by vertically integrating essential wafer processing capabilities. GaNWorks Foundry, Inc., a U.S.-based manufacturing company, specializes in gallium nitride technology, which is vital for producing high-performance laser diodes.

Major companies operating in the laser diode market include Coherent Inc., Hamamatsu Photonics K.K, IPG Photonics Corp., Jenoptik AG, Newport Corporation, ROHM Semiconductor, Sharp Corporation, Sumitomo Electric Industries Ltd, Trumpf Gmbh + Co. KG, austriamicrosystems AG, Axcel Photonics Inc., Bluglass Limited, Frankfurt Laser Company, Kyocera Corporation, Lumentum Holding Inc., MKS Instruments Inc., Power Technology Inc., Thorlabs Inc., Ushio Inc., Panasonic Semiconductor Solutions Co. Ltd, Nichia Corporation, OSI Systems Inc., Laser Components GmbH, Sony Corporation, Mitsubishi Electric Corporation, Nippon Electric Company Ltd., Laser Quantum Ltd., Quantel Laser.

Asia-Pacific was the largest region in the laser diode market in 2024. Asia-Pacific is expected to be the fastest-growing region in the laser diode market during the forecast period. The regions covered in the laser diode market report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, Africa. The countries covered in the laser diode market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Russia, South Korea, UK, USA, Canada, Italy, Spain.

A laser diode is a semiconductor device that utilizes a p-n junction to generate coherent light, characterized by the same frequency and phase within the visible or infrared spectrum. This technology produces a focused laser beam with all light waves having identical wavelengths, traveling together with their peaks aligned. This results in highly concentrated and powerful laser beams that can be directed over a very small area.

The primary types of laser diodes include infrared laser diodes, red laser diodes, blue laser diodes, blue-violet laser diodes, green laser diodes, and ultraviolet laser diodes. Green lasers specifically emit wavelengths within the 500 nm to 559 nm spectral region. Various doping materials, such as InGaN, GaN, AIGaInP, GaAs, and others, are employed in the manufacturing process. Laser diodes utilize technologies such as double heterostructure lasers, quantum well lasers, quantum cascade lasers, distributed feedback lasers, SCH lasers, VCSEL diodes, and VECSEL diodes. These laser diodes find applications across diverse industries, including aerospace and defense, automotive, consumer electronics, electronics and semiconductors, IT and telecommunication, among others.

The laser diode market research report is one of a series of new reports that provides laser diode market statistics, including global market size, regional shares, competitors with a laser diode market share, detailed laser diode market segments, market trends and opportunities, and any further data you may need to thrive in the laser diode industry. This laser diode market research report delivers a complete perspective of everything you need, with an in-depth analysis of the current and future scenario of the industry.

The laser diode market consists of sales of P-type semiconductor material (gallium arsenide), N-type semiconductor material (gallium arsenide), metal casing, and optical lenses. Values in this market are ‘factory gate’ values, that is the value of goods sold by the manufacturers or creators of the goods, whether to other entities (including downstream manufacturers, wholesalers, distributors and retailers) or directly to end customers. The value of goods in this market includes related services sold by the creators of the goods.

The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD, unless otherwise specified).

The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.

This product will be delivered within 3-5 business days.