The VCSEL market is projected to grow from USD 1.4 billion in 2021 to USD 3.3 billion by 2026; it is expected to grow at a CAGR of 18.8% from 2021 to 2026. VCSELs were initially used in limited applications, such as optical mice, laser printing, and heating system. The adoption of VCSEL technology in smartphones for 3D sensing is encouraging the fast adoption of this technology. High-speed data transmission infrastructure that can accommodate the ever-increasing volume of data has become a necessity wherein VCSELs are utilized in optical transceivers. VCSELs are also replacing edge emitting lasers (EELs) in data centers. Use of VCSELs for solid-state automotive LiDAR is expected to be a significant growth area in the medium-to-long term.
Although the VCSEL market is growing at a rapid pace, the market is highly consolidated among the top 5 players, but competitive among other players as well. Key strategies adopted by top players to enhance their product portfolios, increase their market share and expand their presence in the market mainly include acquisitions and new product launches. For instance, in November 2020, Lumentum (US) announced that it had acquired technology assets of TriLumina (US), a semiconductor laser technology start-up. These assets include flip-chip, back-emitting VCSEL arrays for use in a wide range of applications, including 3D sensing, automotive safety, and driver assistance systems, and LiDAR, as well as other emerging applications. In September 2019, II-VI Incorporated (US) acquired Finisar (US), one of the major leaders in the optical communications market. This acquisition will help the company to enter new markets and increase its reach in the global VCSEL market. In January 2020, II-VI Incorporated (US) launched new vertical-cavity surface-emitting lasers (VCSELs) on its vertically integrated 150 mm gallium arsenide (GaAs) technology platform to cater to the growing demand for optical high-definition multimedia interface (optical HDMI) cables in the consumer electronics industry. This is projected to expand its footprint in the consumer electronics market.
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II-VI Incorporated (US) or II-VI is a leader in engineered materials, optoelectronic components, and optical systems offering vertically integrated solutions for a variety of applications. The company develops and manufactures photonic and optoelectronic components and products for different applications in various sectors. II-VI operates in 2 business divisions—Photonic Solutions and Compound Semiconductors. VCSELs are a part of the Compound Semiconductors business segment. The company mainly offers 850 nm VCSEL laser solutions that find applications in consumer electronics, automobiles, material processing, and printing. VCSELs offered by the company are used for optical navigation in high-speed datacom transceivers and optical sensing for consumer electronics applications. In addition, its products for sensing include VCSELs for proximity sensing and thumb navigation and VCSEL arrays for 3D sensing. In September 2019, the company completed the acquisition of Finisar (US), one of the major leaders in the optical communications market.
II-VI has global operations in the US, China, Singapore, Vietnam, the Philippines, Germany, and the UK. The company’s major competitors are MKS Instruments (US), Coherent (US), Lumentum (US), Broadcom (US), and ams (Austria). Some of the subsidiaries of the company include II-VI Singapore Pte., Ltd., II-VI Optics (Suzhou) Co. Ltd. (China), II-VI Japan Incorporated, and II-VI Vietnam Co., Ltd. For the VCSEL market, the company has a presence in the US, APAC, and Europe.
Lumentum (US) is a global technology firm that develops and manufactures optical communication products and industrial lasers. The company was formed as a result of the spin-off of the JDS Uniphase’s (US) business segments into two companies—Viavi Solutions (US) and Lumentum. Lumentum operates through two business segments—Optical Communications (OpComms) and Commercial Lasers (Lasers). The company offers VCSELs through its Optical Communications business segment. This segment provides optical transceivers that are equipped with VCSELs, and subsystems for telecom, data center, enterprise, metro optics, and other applications. The Lasers segment provides various commercial, as well as 3D sensing and industrial diode lasers. Diode lasers offered by the company include edge-emitting diode laser, fiber-coupled diode laser, and VCSELs. The wavelength of these VCSELs is 850 nm and is made of gallium arsenide (GaAs). The VCSELs offered by the company have a data rate in the range of 25 Gb/s to 50 Gb/s.
The company has manufacturing facilities in China, Italy, Japan, Thailand, the UK, and the US. The major customers of the company are Alphabet (US), Apple (US), Cisco Systems (US), and Huawei Technologies (China). Apple was the largest customer of the company in 2020, with 26% net revenue generated from Apple. Some subsidiaries of the company are Lumentum Asia Limited (Hong Kong), Lumentum Canada Ltd., Lumentum Japan Inc., Lumentum Netherlands B.V., and Oclaro Germany GmbH. The company has a presence in the Americas, APAC, Europe, and the Middle East & Africa.
VCSEL Market with COVID-19 Impact Analysis by Type, Material (GaAs, InP), Wavelength, Application (Sensing, Data Communication, Industrial Heating & Printing, Emerging), Data Rate, Industry, and Region - Global Forecast to 2026
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