Outdoor Lighting Market - Global Industry Size, Share, Trends, Opportunity, and Forecast, 2021-2031

The Global Outdoor Lighting Market is projected to expand from USD 13.64 Billion in 2025 to USD 32.82 Billion by 2031, achieving a CAGR of 15.76%. This sector involves providing artificial lighting for exterior spaces, such as streets, parking lots, walkways, and architectural sites, using technologies like Light Emitting Diodes and High Intensity Discharge lamps. Key growth drivers include rapid global urbanization, which demands extensive infrastructure development, and strict government mandates for energy efficiency. These regulations push municipalities and businesses to swap out old lighting systems for sustainable options, fueling demand for products that cut operational expenses and reduce carbon emissions.

Despite this growth potential, the market encounters a major hurdle in the form of high upfront capital costs for modern smart lighting, which can discourage cash-strapped municipalities from starting major projects. Nevertheless, the industry remains hopeful about future adoption and demand. For instance, the National Electrical Manufacturers Association reported that the future conditions component of the Electroindustry Business Confidence Index hit 84.6 in June 2024, signaling strong growth expectations in electrical and lighting manufacturing. This optimism implies that the long-term benefits of operational savings are increasingly validating the initial investment required.

Market Drivers

The widespread move toward energy-efficient LED technology is fundamentally transforming the global outdoor lighting sector as utilities and local governments aggressively replace outdated high-intensity discharge systems. This transition is largely motivated by the urgent necessity to achieve decarbonization goals and lower operational electricity usage, leading to the phase-out of traditional lighting methods. The dominance of solid-state lighting is evident in the sales figures of key industry players; for example, Signify’s 'Fourth quarter and Full-Year Results 2023 Report' from January 2024 revealed that LED-based products accounted for 85% of the company's total sales, highlighting the extensive market shift away from conventional alternatives.

Concurrently, smart city projects and infrastructure upgrades are generating value that extends beyond basic illumination. Urban planners are integrating IoT-enabled controls to improve public safety, manage traffic, and streamline maintenance via connected systems, which requires significant capital investment. Notably, the City of Philadelphia announced in a February 2024 update on the 'Philly Streetlight Improvement Project' a $91 million commitment to upgrade roughly 130,000 streetlights to a remotely controlled network. Such massive modernization initiatives continue to drive substantial revenue for manufacturers, as evidenced by Acuity Brands reporting fiscal year net sales of $3.84 billion in October 2024, demonstrating the persistent demand for advanced infrastructure solutions.

Market Challenges

The substantial initial capital expenditure necessary for advanced outdoor lighting systems represents a significant financial obstacle that directly hinders market expansion. While LED technologies and smart controls deliver operational efficiencies, the upfront costs associated with procurement, infrastructure modifications, and installation are often too high for many buyers. Commercial entities and municipalities frequently face strict budget limitations, making it challenging to allocate significant funds for immediate system replacements. As a result, these financial constraints compel decision-makers to postpone or reduce the scope of modernization efforts, effectively slowing the transition from legacy infrastructure to modern solutions.

This reluctance to invest capital is reflected in recent industry data, which stands in contrast to long-term positive sentiment. In 2024, the National Electrical Manufacturers Association reported that the current conditions component of the Electroindustry Business Confidence Index fell to 46.7 in April, signaling a contraction within the sector. This decline highlights the challenges stakeholders encounter when trying to implement projects under current economic conditions. Consequently, when initial funding is scarce, the market suffers a noticeable reduction in shipment volumes and project launches, despite the potential for future energy cost reductions.

Market Trends

The adoption of standardized modular Zhaga connectivity is becoming a vital trend for ensuring the longevity of luminaires, addressing requirements for interoperability and circular economy practices in outdoor infrastructure. In contrast to proprietary designs, this approach permits municipalities to upgrade communication and sensing modules without discarding the entire fixture, thereby prolonging asset life and minimizing electronic waste. This shift toward interchangeable parts is accelerating as standards bodies broaden their coverage; for instance, the Zhaga Consortium released Edition 4 of its Book 18 specification in November 2025 to rigorously define interfaces for over 600 member companies, ensuring compatibility across heritage and decorative outdoor lighting applications.

At the same time, the market is seeing extensive adoption of autonomous off-grid solar LED systems, driven by the need for resilient infrastructure that operates independently of the electrical grid. This trend differs from general energy efficiency measures as it removes the high civil engineering costs linked to cabling and trenching, especially in remote areas or expanding urban edges. Manufacturers are catering to this demand by embedding advanced battery storage and photovoltaics into modular pole systems to capture this growing market segment. Illustrating this success, Signify reported sales of EUR 1.4 billion in its 'Third Quarter Results 2025' report from October 2025, a figure bolstered by the expansion of its professional portfolio to include new connected solar street lighting products.

Key Players Profiled in the Outdoor Lighting Market

• Acuity Brands, Inc.
• Hubbell Incorporated
• Osram Licht AG
• Cree, Inc.
• Zumtobel Group AG
• Eaton Corporation PLC
• Fagerhult Group AB
• Schreder S.A.

Report Scope

In this report, the Global Outdoor Lighting Market has been segmented into the following categories:

Outdoor Lighting Market, by Type:

• Street Lights
• Flood Lights
• Garden Lights
• Path Lights
• Bollard Lights

Outdoor Lighting Market, by Light Source:

• LED
• High-Intensity Discharge (HID)
• Fluorescent Lights
• Incandescent Lights

Outdoor Lighting Market, by End User:

• Government
• Commercial
• Residential

Outdoor Lighting Market, by Region:

• North America
• Europe
• Asia-Pacific
• South America
• Middle East & Africa

Competitive Landscape

Company Profiles: Detailed analysis of the major companies present in the Global Outdoor Lighting Market.

Available Customization

The analyst offers customization according to your specific needs. The following customization options are available for the report:

• Detailed analysis and profiling of additional market players (up to five).

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