Vertical Cavity Surface Emitting Lasers (VCSEL) Market Size & Share, by Type (Multi-mode VCSEL, Single-mode VCSEL); Material (Gallium Arsenide, Gallium Nitride, Indium Phosphide); Application (Telecom, Consumer Electronics, Automotive, Medical, Industrial, Aerospace & Defense) - Global Supply & Demand Analysis, Growth Forecasts, Statistics Report 2023-2035

  • Report ID: 3956
  • Published Date: May 26, 2023
  • Report Format: PDF, PPT

Global Market Size, Forecast, and Trend Highlights Over 2023 - 2035

Vertical Cavity Surface Emitting Lasers Market size is expected to cross USD 10 Billion by the end of 2035, growing at a CAGR of 21% during the forecast period i.e., 2023-2035. In the year 2022, the industry size of vertical cavity surface emitting lasers was USD 3 Billion. The primary factor projected to boost the market demand is the growing number of data centers. Around the globe, there are about 7,999 data centers. Of those, approximately 32% of the data centers are situated in the US. In data centers, multimode fiber (MMF)-based optical communications are primarily powered by vertical-cavity surface-emitting lasers (VCSELs).

Moreover, VCSELs are utilized in optical communication technologies, similar to other lasers. They are perfect for optical communication owing to their features, which include a circular beam form, a wide free spectral range, and massive and continuous tuning. Additionally, a range of VCSEL applications, including high bandwidth, would be seen in this field since communication technologies have a promising future and must develop.

Vertical Cavity Surface Emitting Lasers Market
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Vertical Cavity Surface Emitting Lasers Sector: Growth Drivers and Challenges

Growth Drivers

  • Growing Adoption of Smartphones- With about 5 billion smartphone users globally as of 2023, approximately 85% of the world's population is expected to be smartphone owners. Hence, with this the market size is slated to grow. Almost all smartphones launched recently consist of 3D sensing. 3D sensing implementation in smartphones heavily relies on VCSELs. With the floodlight, and proximity sensor, VCSEL laser components enable 3D camera sensing.
  • Rising Demand for Autonomous Vehicles- There are anticipated to be about 53 million autonomous vehicles in 2024, globally. With the growing demand for autonomous vehicles, the installment of VCSEL is also predicted to grow. This laser is being tested and used in driverless or autonomous vehicles. Regarding power density, conversion efficiency, and pitch, the market for smart cars believes VCSEL arrays to be the best available. In addition, distinguishable in scan and flash applications, VCSELs are less prone to single-emitter failures.
  • Surge in Application of VCSEL in Biomedical- VCSELs are employed for integrated and label-free sensing of numerous biomolecules in the biomedical field. These sensors have also been utilized in lab-on-a-chip settings to examine fluorescent compounds and to analyze real-time biomolecules.


  • Stringent Manufacturing Process
  • Restriction on Range of Data Transmission
  • Low Adoption of INP-Based VCSEL - Due to its low dispersion and minimal fiber loss, InP-based VCSELS are frequently chosen for applications including optical communication. However, due of their high reflectivity and shallow penetration, InP-based VSCELS are unable to produce large DBR mirrors. The confinement factor and tuning range are constrained by the effective cavity length.

Vertical Cavity Surface Emitting Lasers Market: Key Insights

Base Year


Forecast Year




Base Year Market Size (2022)

~ USD 3 Billion

Forecast Year Market Size (2035)

~ USD 10 Billion

Regional Scope

  • North America (U.S., and Canada)
  • Latin America (Mexico, Argentina, Rest of Latin America)
  • Asia-Pacific (Japan, China, India, Indonesia, Malaysia, Australia, Rest of Asia-Pacific)
  • Europe (U.K., Germany, France, Italy, Spain, Russia, NORDIC, Rest of Europe)
  • Middle East and Africa (Israel, GCC North Africa, South Africa, Rest of the Middle East and Africa)
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Vertical Cavity Surface Emitting Lasers Segmentation

Application (Telecom, Consumer Electronics, Automotive, Medical, Industrial, Aerospace & Defense)

The consumer electronics segment in the vertical cavity surface emitting lasers market is projected to generate the highest revenue by 2035. One important sector for 3D sensing applications is consumer electronics. The primary cutting-edge technology that provides sophisticated illumination sources for optical sensing is VCSEL technology. VCSEL laser arrays are advantageous for camera autofocus and 3D sensor systems in smartphones and tablets.

Type (Multi-mode VCSEL, Single-mode VCSEL)

The multi-mode vertical cavity surface emitting lasers market is poised to have significant growth during the forecast period, due to the huge power densities that these vertical-cavity surface-emitting lasers are capable of with a brief rise time. Thus, their application is becoming more widespread in LiDAR, time-of-flight (TOF), lighting, industrial, and other high-power applications. Also, owing to their small size, multimode VCSELs are perfect for use in highly integrated sensors and are preferable for mobile consumer applications.

Our in-depth analysis of the global market includes the following segments:



  • Multi-mode VCSEL
  • Single-mode VCSEL



  • Gallium Arsenide
  • Gallium Nitride
  • Indium Phosphide




  • Telecom
  • Consumer Electronics
  • Automotive
  • Medical
  • Industrial
  • Aerospace & Defense

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VCSEL Industry - Regional Synopsis

APAC Market Statistics

The vertical cavity surface emitting lasers market in Asia Pacific is estimated to have the largest growth by 2035, backed by the domination of manufacturing of semiconductors, and smartphones in this region. Many of the multinational smartphone businesses are based in this area.

Countries such as India, Vietnam, and Thailand among others, are seeing an increase in the number of smartphone and consumer electronics manufacturers establishing manufacturing units in the region. The region's demand for VCSELs is also rising as a result of organic electronic fabrication in the burgeoning economies there.

North American Market Forecast

The North America vertical-cavity surface emitting lasers market is slated to have significant growth between 2023 and 2035, on account of the rising adoption of IoT.

IoT connections are projected to cross approximately 4 billion by 2025, in North America. Hence, in order to avoid the data traffic, the construction of data centers is growing further, increasing demand for vertical-cavity surface-emitting lasers.

Research Nester
Vertical Cavity Surface Emitting Lasers Market Size
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Companies dominating the Vertical Cavity Surface Emitting Lasers (VCSEL) Landscape

    • Lumentum Operations LLC
      • Company Overview
      • Business Strategy
      • Key Product Offerings
      • Financial Performance
      • Key Performance Indicators
      • Risk Analysis
      • Recent Development
      • Regional Presence
      • SWOT Analysis 
    • Vixar Inc.
    • Hamamatsu Photonics K.K.
    • TRUMPF
    • Coherent Corporation
    • Broadcom Inc.
    • Vertilite Inc.
    • Santec Holdings Corporation
    • Alight Solutions, LLC
    • Connector Optics LLC


In The News

  • TRUMPF to acquire Active Fiber Systems GmbH (AFS) to develop and manufacture ultra-short pulse laser systems and fiber-laser systems.
  • Mercedes-Benz, and NVIDIA, to form a cooperation to create in-vehicle computing system and AI computing for the next-generation Mercedes-Benz vehicles, enabling them with upgradable automated driving functions, starting in 2024.

Author Credits:  Abhishek Verma, Hetal Singh

  • Report ID: 3956
  • Published Date: May 26, 2023
  • Report Format: PDF, PPT

Frequently Asked Questions (FAQ)

The major factors driving the growth of the market are the growing adoption of smartphones, rising demand for autonomous vehicles, and a surge in the application of VCSEL in biomedical.

The market size of vertical-cavity surface-emitting lasers (VCSEL) is anticipated to attain a CAGR of ~21% over the forecast period, i.e., 2023-2035.

Stringent manufacturing process, restriction on range of data transmission, and low adoption of INP-based VCSEL are estimated to be the growth hindering factors for the market expansion.

The market in the Asia Pacific region is projected to hold the largest market share by the end of 2035 and provide more business opportunities in the future.

The major players in the market are Lumentum Operations LLC, Vixar Inc., Hamamatsu Photonics K.K., TRUMPF, and more.

The company profiles are selected based on the revenues generated from the product segment, the geographical presence of the company which determines the revenue generating capacity as well as the new products being launched into the market by the company.

The market is segmented by type, material, application, and by region.

The multi-mode VCSEL segment is anticipated to garner the largest market size by the end of 2035 and display significant growth opportunities.
Vertical Cavity Surface Emitting Lasers Market Report Scope

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