Chiplet Market by Processor (Field-Programmable Gate Array (FPGA), Central Processing Unit (CPU), Graphics Processing Unit (GPU), APU, AI ASIC Co-Processor), Packaging Technology (SiP, FCCSP, FCBGA, 2.5D/3D, WLCSP, Fan-Out) – Global Forecast to 2028
Updated on : October 27, 2023
The chiplet market was valued at USD 6.5 billion in 2023 and is estimated to reach USD 148.0 billion by 2028, registering a CAGR of 86.7% during the forecast period.
The growth of the chiplet market is driven by adoption of high-performance computing (HPC) servers in various sectors, proliferation of data centers worldwide, and adoption of advanced packaging technologies.
Chiplet Market Forecast to 2028
To know about the assumptions considered for the study, Request for Free Sample Report
Market Dynamics:
Drivers: Adoption of high-performance computing (HPC) servers in various sectors
High-performance computing (HPC) servers are utilized across various fields, including research, finance, manufacturing, weather forecasting, pharmaceuticals, entertainment, government, energy, automotive, space exploration, e-commerce, telecommunications, and environmental research. These HPCs power complex computations and simulations, supporting innovation and decision-making in diverse fields, from scientific research to national defense. These HPCs utilize chiplet-based architectures, which allow for the efficient integration of specialized processing units, memory, and accelerators, enabling HPC servers to deliver unprecedented levels of performance while maintaining energy efficiency and scalability, which are crucial for handling complex simulations, scientific research, and AI workloads. Chiplets enable HPC server manufacturers to enhance scalability and performance. Chiplet-based HPC servers overcome the limitations of Moore's law and allow for the integration of multiple specialized chips on a single server board. According to MarketsandMarkets’ analysis, the high-performance computing (HPC) market is expected to grow from USD 36.0 billion in 2022 to USD 49.9 billion by 2027, at a CAGR of 6.7%. This growth is intrinsically linked to the burgeoning demand for applications that rely heavily on HPC capabilities, thus indicating a parallel surge in demand for chiplets as these modular components become increasingly integral to HPC server architecture.
Restraint: Heat management issues
Heat management emerges as a restraining factor for the chiplet market. The ever-increasing power density and the relentless drive for semiconductor miniaturization have led to a surge in heat generation. This, compounded by the close integration of multiple chiplets on a single package, amplifies the thermal challenges. The imperative for effective heat dissipation and precise temperature control has become paramount to maintaining the optimal functioning of chiplets. The compact size of chiplets renders efficient heat dissipation a formidable task. Moreover, the densely interconnected configurations of chiplets exacerbate heat generation, compounding the problem. The diverse thermal properties of chiplet materials and the variability in their operating conditions further complicate the design of effective, standardized thermal management solutions.
Opportunities: Rapid expansion of 5G infrastructure
Chiplets are vital components within the 5G infrastructure, strategically embedded in key network elements. They play a crucial role in base stations, where they are integrated into radio frequency (RF) transceivers. This placement empowers base stations to efficiently process high-frequency signals, perform beamforming, and manage intricate modulation schemes essential for 5G's massive multiple-input multiple-output (MIMO) systems. Additionally, chiplets enhance the computational prowess of central processing units (CPUs) in base stations, enabling real-time data processing, protocol handling, and sophisticated algorithms. They also feature in accelerators, offloading tasks such as error correction and encryption, ensuring high-throughput processing for low-latency, reliable communication. Moreover, chiplets find utility in front and backhaul equipment, optimizing data transmission and synchronization. Their role extends to edge computing nodes, facilitating rapid data processing at the network's edge, enhancing the responsiveness of critical applications like autonomous vehicles and augmented reality. Chiplets are instrumental in fortifying 5G infrastructure, enhancing its capacity to manage high-frequency signals, complex computations, low-latency communication, and edge computing demands.
The increasing adoption of 5G technology, driven by the deployment of new networks and the affordability of 5G devices, presents a significant opportunity for the chiplet market. According to the statistics of GSM Association, as of January 2023, there were 229 operational 5G networks globally, and the market had seen the introduction of over 700 5G smartphone models, including more than 200 in 2022 alone. This rapid expansion of 5G infrastructure creates a growing ecosystem for chiplets in the telecommunications sector, as chiplets play a vital role in enhancing the performance of 5G devices and base stations. Furthermore, the declining usage of legacy networks like 2G and 3G, with operators planning to shut down 96 2G networks and 107 3G networks worldwide, underscores the importance of chiplet-based solutions for upgrading and optimizing the connectivity and processing capabilities of 4G and 5G networks. Chiplets enable operators to enhance the efficiency and capabilities of network equipment and devices, making them well-suited to meet the evolving demands of 5G technology. Thus, the expanding 5G landscape not only signifies a significant growth opportunity for chiplets but also emphasizes their critical role in supporting the continued evolution of telecommunications networks.
Challenge: related to intellectual property (IP) protection and licensing
The chiplet market faces a formidable challenge rooted in intellectual property (IP) concerns. At its core, relentless patent disputes cast a long shadow over innovation, demanding substantial financial and human resources for resolution. This industry's intense competition has given rise to a multitude of patents covering various chiplet technologies, leading to frequent allegations of patent infringement. Compounding this issue is the inherent complexity of semiconductor patents, intricately linked to the advanced nature of the technology itself. Navigating these disputes consumes considerable resources, potentially stifling the pace of innovation and depleting financial reserves.
Simultaneously, the chiplet market grapples with the vulnerability of closely guarded trade secrets. The need to protect proprietary chiplet designs and manufacturing processes is paramount due to their intrinsic competitive value. However, in a globally interconnected supply chain, preserving the confidentiality of these trade secrets becomes increasingly challenging. Unauthorized access or leaks can result in IP theft, posing a threat to a company's unique advantage and market standing. These dual IP challenges—patent disputes and trade secrets vulnerability—underscore the critical importance of effectively managing and safeguarding intellectual property assets within the chiplet industry. Overcoming these hurdles is pivotal for sustained growth and innovation in this dynamic and competitive market.
Chiplet Ecosystem
Central Processing Unit (CPU) segment to hold larger market share during the forecast period.
The CPU segment is expected to grow substantially due to its critical role in powering a wide range of computing devices. As the demand for higher processing power, energy efficiency, and scalability surge, chiplet-based CPU designs are expected to gain popularity. Chiplets enable CPU manufacturers to optimize and modularize their designs, incorporating specialized chiplets for various functions like cores, cache, and memory controllers. This approach enhances overall CPU performance, efficiency, and adaptability, catering to diverse applications from consumer electronics to data centers. Moreover, the trend toward heterogeneous computing, driven by emerging workloads in artificial intelligence and data analytics, further propels the CPU segment’s growth. As chiplet-based CPUs continue to provide a competitive edge in the rapidly evolving semiconductor landscape, their demand is expected to be high to meet the evolving demands of modern computing ecosystems.
2.5D/3D segment account for the largest share of the chiplet market for during the forecast period
2.5D/3D packaging has emerged as a transformative technology reshaping the chiplet landscape. By enabling vertical stacking of chiplets, 2.5D/3D packaging guarantees high performance, bandwidth, and miniaturization. 2.5D/3D is a packaging methodology that enables the inclusion of multiple ICs into the same package. In a 2.5D structure, two or more active semiconductor chips are placed side-by-side on a silicon interposer to achieve extremely high die-to-die interconnect density. In a 3D structure, active chips are integrated by die stacking for the shortest interconnect and smallest package footprint. In recent years, 2.5D and 3D have gained momentum as the ideal chiplet integration platforms due to their merits in achieving extremely high packaging density and energy efficiency.
Enterprise Electronics segment to exhibit highest growth in terms of chiplet market during the forecast period
Chiplets are revolutionizing various enterprise electronics applications, including data center servers, AI accelerators, high-performance computing (HPC) systems, network equipment, and storage systems. They offer superior performance, efficiency, cost-effectiveness, and scalability compared with traditional monolithic chips. Chiplets’ interconnectivity creates more powerful and specialized chips, reducing power consumption and manufacturing costs. As chiplet technology advances, its demand in enterprise electronics is likely to increase to enhance capabilities.
Chiplet market in Asia Pacific estimated to grow at the fastest rate during the forecast period
Due to several compelling factors, such as the booming technology sector, research and development investments, government-led digital transformation initiatives, rising disposable income, and a favorable regulatory environment, the Asia Pacific chiplet market is projected to grow substantially. The semiconductor industry in the region boasts a powerful network of foundries, manufacturers, and technology innovators, driving significant advancements in chiplet-based designs. The region is also witnessing high demand for advanced electronic devices, particularly in populous countries such as China and India, making it a prime target for chiplet technology. Moreover, the rapid rollout of 5G networks across the region drives the need for efficient, high-performance computing, aligning seamlessly with chiplet capabilities in power efficiency and heterogeneous integration. Asia Pacific governments’ substantial investments in research and development, notably in South Korea, Taiwan, and Singapore, underscore their commitment to fostering innovation.
Chiplet Market by Region
To know about the assumptions considered for the study, download the pdf brochure
Top Chiplet Companies - Key Market Players:
Major vendors in the chiplet companies include Intel Corporation (US), Advanced Micro Devices, Inc. (US), Apple Inc. (US), IBM (US), Marvell (US), MediaTek Inc. (Taiwan), NVIDIA Corporation (us), Achronix Semiconductor Corporation (US), Ranovus (Canada), and ASE Technology Holding Co., Ltd. (Taiwan). Apart from this, Netronome (US), Cadence Design Systems, Inc. (US), and Synopsys, Inc. (US), SiFive, Inc. (US), ALPHAWAVE SEMI (UK), Eliyan (US), Ayar Labs, Inc. (US), Tachyum (US), X-Celeprint (Ireland), Kandou Bus SA (Switzerland), NHanced Semiconductors (US), Tenstorrent (Canada), Chipuller (China) and Rain Neuromorphics (US) are among a few emerging companies in the chiplet market.
Chiplet Market Report Scope :
|
Report Metric |
Details |
| Estimated Market Size | USD 6.5 billion in 2023 |
| Projected Market Size | USD 148.0 billion by 2028 |
| Growth Rate | CAGR of 86.7% |
|
Market size available for years |
2019—2028 |
|
Base year |
2022 |
|
Forecast period |
2023—2028 |
|
Segments covered |
|
|
Geographic regions covered |
|
|
Companies covered |
The major players include Intel Corporation (US), Advanced Micro Devices, Inc. (US), Apple Inc. (US), IBM (US), Marvell (US), MediaTek Inc. (Taiwan), NVIDIA Corporation (us), Achronix Semiconductor Corporation (US), Ranovus (Canada), and ASE Technology Holding Co., Ltd. (Taiwan) and Others- total 25 players have been covered. |
Chiplet Market Highlights
This research report categorizes the chiplet market based on processor, packaging technology, end-use application, and region.
|
Segment |
Subsegment |
|
By Processor: |
|
|
By Packaging Technology: |
|
|
By End-use Application: |
|
|
By Region: |
|
Recent Developments
- In August 2023, Google Cloud (US) and NVIDIA Corporation (US) collaborated to offer advanced AI infrastructure and software for deploying large generative AI models and accelerating data science tasks. This partnership streamlines AI supercomputer deployment via Google Cloud's NVIDIA-powered solutions, leveraging the same technology utilized by Google DeepMind and research teams. The integration optimizes PaxML, Google's LLM framework, for NVIDIA, accelerated computing, enhancing experimentation and scalability with H100 and A100 Tensor Core GPUs.
- In June 2023, Intel Corporation (US) announced a partnership with Taiwan Semiconductor Manufacturing Company Limited (Taiwan) to manufacture chips for Intel's high-performance computing and graphics products. The partnership would help Intel reduce its reliance on external foundries.
- In June 2023, Advanced Micro Devices Inc. (US) and Hewlett Packard Enterprise Co. (HPE) (US) collaborated on various initiatives emphasizing sustainability in technology. AMD's approach to energy efficiency involves chip design, notably utilizing chiplets to enhance efficiency and drive innovation for a more sustainable future. This innovation promises significant strides in sustainability.
Key Questions Addressed in the Report
What is the total CAGR expected to be recorded for the chiplet market during 2023-2028?
The global chiplet market is expected to record the CAGR of 86.7% from 2023-2028.
Which regions are expected to pose significant demand for chiplet market from 2023-2028?
Asia Pacific and North America is expected to pose significant demand from 2023 to 2028. Major economies such as US, Canada, China, Japan, and South Korea are expected to have a high potential for the future growth of the market.
What are the major market opportunities in the chiplet market?
Development of quantum chiplets, rapid expansion of 5G infrastructure, rising incorporation of high-performance and power-efficient chiplets into medical devices, adoption of chiplets in AI and edge computing applications, and increasing investments in autonomous vehicles are projected to create lucrative opportunities for the players operating in the chiplet market during the forecast period.
Which are the significant players operating in chiplet market?
Key players operating in the chiplet market are Intel Corporation (US), Advanced Micro Devices, Inc. (US), Apple Inc. (US), IBM (US), and Marvell (US).
What are the major end-use applications of the chiplet market?
Enterprise electronics, consumer electronics, automotive, industrial automation, healthcare, military and aerospace, are the major end-use applications of the chiplet market.
To speak to our analyst for a discussion on the above findings, click Speak to Analyst
The study involved four major activities in estimating the size for chiplet market. Exhaustive secondary research was done to collect information on the market, peer market, and parent market. The next step was to validate these findings, assumptions, and sizing with industry experts across value chains through primary research. The bottom-up approach was employed to estimate the overall market size. After that, market breakdown and data triangulation were used to estimate the market size of segments and subsegments.
Secondary Research
In the secondary research process, sources such as annual reports, press releases, investor presentations of companies, white papers, and articles by recognized authors were referred to. Secondary research was done to obtain key information about the market’s supply chain, the market's value chain, the pool of key market players, and market segmentation according to industry trends, region, and developments from both market and technology perspectives.
Primary Research
Extensive primary research has been conducted after understanding and analyzing the chiplet market scenario through secondary research. Several primary interviews have been conducted with key opinion leaders from both demand- and supply-side vendors across four major regions—North America, Europe, Asia Pacific, and RoW. Approximately 25% of primary interviews have been conducted with the demand side and 75% with the supply side. These primary data have been collected through telephonic interviews, questionnaires, and emails.
To know about the assumptions considered for the study, download the pdf brochure
Market Size Estimation
In the complete market engineering process, top-down and bottom-up approaches and several data triangulation methods have been used to estimate and forecast the market size for the overall market segments and subsegments listed in this report. Extensive qualitative and quantitative analyses have been performed on the complete market engineering process to list the key information/insights throughout the report.
The key players in the market have been identified through secondary research, and their market shares in the respective regions have been determined through primary and secondary research. This entire procedure includes the study of annual and financial reports of the top players as well as extensive interviews with industry experts (such as CEOs, VPs, directors, and marketing executives) for key insights (both quantitative and qualitative) on the chiplet market. All percentage shares, splits, and breakdowns have been determined using secondary sources and verified through primary sources. All the possible parameters that affect the markets covered in this research study have been accounted for, viewed in extensive detail, verified through primary research, and analyzed to get the final quantitative and qualitative data. This data has been consolidated and supplemented with detailed inputs and analysis from MarketsandMarkets and presented in this report.
Chiplet Market: Bottom-Up Approach
The bottom-up approach has been employed to arrive at the overall size of the chiplet market from the revenues of key players and their share in the market.
Chiplet Market: Top-Down Approach
In the top-down approach, the overall market size has been used to estimate the size of the individual markets (mentioned in the market segmentation) through percentage splits from secondary and primary research. For the calculation of specific market segments, the most appropriate immediate parent market size has been used to implement the top-down approach. The bottom-up approach has also been implemented for the data obtained from the secondary research to validate the market size of various segments. Each company’s market share has been estimated to verify the revenue shares used earlier in the bottom-up approach. With the data triangulation procedure and validation of the data through primaries, the overall parent market size and each individual market size have been determined and confirmed in this study.
Data Triangulation
After arriving at the overall market size through the above process, the overall market has been split into several segments. To complete the overall market engineering process and arrive at the exact statistics for all the segments, market breakdown, and data triangulation procedures have been employed, wherever applicable. The data has been triangulated by studying various factors and trends from both the demand and supply sides. The market has also been validated using both top-down and bottom-up approaches.
Definition
A chiplet is a discrete hardware component integrated into a heterogeneous integrated circuit (IC). Its role is to enhance the functionality of the final IC, ensuring it matches or exceeds the capabilities of a monolithic die, typically by optimizing specific functions economically or physically. Chiplets represent a fundamental shift in semiconductor design and manufacturing, departing from the traditional monolithic approach where all semiconductor device components are integrated into a single monolithic die.
Key Stakeholders
- Chiplet manufacturers
- Semiconductor foundries
- Original equipment manufacturers (OEMs)
- Fabless semiconductor companies
- Electronic design automation (EDA) providers
- Packaging and interconnect suppliers
- Material suppliers
- Test and inspection equipment manufacturers
- Industry associations and standards bodies
- Research and development institutions
- Government regulatory bodies
- Investors and financial institutions
- Competitive analysis firms
Report Objectives
- To describe and forecast the chiplet market based on processor, packaging technology, end-use application, and region
- To forecast the size of the market segments for major regions—North America, Europe, Asia Pacific, and the Rest of the World (RoW)
- To provide detailed information regarding the major factors influencing the growth of the market (drivers, restraints, opportunities, and challenges)
- To provide an ecosystem analysis, case study analysis, patent analysis, technology analysis, indicative pricing analysis, Porter’s Five Forces analysis, and regulatory landscape pertaining to the chiplet market
- To provide a detailed overview of the value chain of the chiplet market
- To strategically analyze micromarkets1 with respect to individual growth trends, prospects, and contributions to the total market
- To strategically profile the key players and comprehensively analyze their market shares and core competencies2
- To analyze the opportunities in the market for stakeholders and describe the competitive landscape of the market
- To analyze competitive developments such as collaborations, agreements, partnerships, product developments, and research & development (R&D) in the market
- To analyze the impact of the recession on the chiplet market
Available Customizations
With the given market data, MarketsandMarkets offers customizations according to the company’s specific needs. The following customization options are available for the report:
Company Information
- Detailed analysis and profiling of additional market players (up to 7)
Growth opportunities and latent adjacency in Chiplet Market