Advanced Optics Market Size, Share & Industry Analysis, By Technology (Ray Optics, Wave Optics, and Quantum Optics), By Application (LiDAR, Lighting Solution, Optical Communication, Intelligence, Surveillance & Reconnaissance (ISR), Medical Equipment, Camera, Metrology Devices, 3D Scanner, and Others), By End-use Industry (Commercial, Industrial, Defense, Medical, Aviation (Drone), Automotive, Space, and Others), and Regional Forecast, 2024-2032

The global advanced optics market size was valued at USD 287.29 billion in 2023. The market is projected to grow from USD 310.56 billion in 2024 to USD 628.80 billion by 2032, exhibiting a CAGR of 9.2% during the forecast period. Asia Pacific dominated the advanced optics market with a market share of 40.97% in 2023.

The global impact of COVID-19 has been unprecedented and staggering, with advanced optics witnessing a negative impact on demand across all the regions amid the pandemic. Based on our analysis, the global market exhibited a decline of 18.6% in 2020 as compared to the average year-on-year growth during 2017-2019. The rise in CAGR is attributable to this market’s growth and demand, returning to pre-pandemic levels once the pandemic is over.

Advanced optics solution is made using an optical component such as optical mirror, optical lenses, or prism and optical material. The optical solutions provide numerous advantages such as secure communication, low weight, high bandwidth, high flexibility, low power consumption, and high efficiency. Due to these advantages, the advanced optical system and components are extensively used in a variety of applications, including high-resolution microscopy, gyroscope, lithography system, electro-optical/infrared (EO/IR) system, displays, windows, medical equipment, imaging system, metrology devices, lighting solutions, security and surveillance system, spacecraft system, ophthalmology and retinal imaging, and drone components among others. The growing adoption of the optics in these applications is anticipated to drive the market growth during 2024-2032. The several end-use markets, including semiconductor, industrial manufacturing, consumer electronics, defense, and aerospace, are actively involved in developing robust optical solutions to enhance their application performance and efficiency. The growing digitalization and adoption of artificial intelligence, industry 4.0 technology, focus on next-generation product development, large investment in defense, space, and R&D activities are major factors supporting the market growth during the forecast period.

Advanced Optics Market Trends

Adoption of AI in Advanced Optics to Spur Various Opportunities in Near Future

Artificial intelligence (AI) is a broad field of science that allows computers to solve problems by simulating complicated biological processes like learning, reasoning, and self-correction. AI entities and systems can mimic biological processes to conduct operations similar to learning and decision-making, focusing on human cognitive processes. The adoption of AI in optical solution has become an area of research over the past decade. Furthermore, for the adoption of AI in optical communication convolutional neural networks (CNNs), recurrent neural networks (RNNs), generative adversarial networks (GANs), deep reinforcement learning (DRL), end-to-end learning based on auto encoders, and their variants have made significant contributions to fields such as network traffic data, routing, resource allocation, automatic configuration.  AI is widely used for the proactive detection of fiber cuts. THE Nokia GMPLS wavelength routing solution provides a solution for power network protection and restoration capabilities. This computes backup fiber routes to reconfigure network resources to use higher routes.

Advanced Optics Market Growth Factors

Rising Demand for Photonics Enabled Products to Enhance System Efficiency to Aid Growth

Primary uses of photonics devices are fiber optic telecommunication, optical data storage, displays, laser printing. Photonics-enabled devices offer higher energy efficiency, longer product lifespan, better precision, and faster operation. The increased focus from consumers toward upgrading photonic devices with advanced telecommunication components and high-speed data transferability is one of the driving factors. The photonics devices are used for high bandwidth, multi-channel wavelength compiled with optical communication.

The photonics market is primarily driven by silicon-based photonics applications. In telecommunications and data center applications, hybrid silicon lasers (silicon and group III-V semiconductor) are utilized, which benefit from the light-emitting capabilities of III-V semiconductor materials.

Rising R&D Investments in Advanced Optics Technology to Fuel Market Growth

Adaptive optics were first developed for the defense industry and are widely employed in several defense applications, including wall imaging systems, missile protection systems, and others around the globe. The U.S., with its substantial defense budgets and well-developed industrial defense complex, continues to use adaptive optics for high-energy laser systems and other applications. There is continuous research on the applications of optical system in healthcare across universities and research laboratories globally. In the medical industry, fiber optic sensors play a vital role in monitoring and measuring pressure, temperature, and oxygen concentrations. Additionally, fiber optics cables utilized in healthcare and medical is also employed in other applications such as remote spectrophotometry, endoscopic imaging, and pressure and position sensors.

RESTRAINING FACTORS

Complex Design and Optimization of Space Optical Solutions to Impede Market Growth

Space optics is difficult to implement due to the complexity in designing and optimizing robust optics systems. Various factors, such as space environment that imposes thermal conditions, cold background, operational variations, and varying temperature gradients, are to be considered for optimization of the material. Furthermore, the market for adaptive optics is being held back by the intensive computations necessary for modern optical system modeling and the difficulties in detecting non-common path aberrations (NCPA). When using an adaptive optics system to generate modified images in a cosmic instrument, non-common path aberrations (NCPA) are a common problem. The most common method for correcting NCPA is to induce an offset in the Wavefront Sensor (WFS) signals that correlate with the corrected aberration.

To overcome such difficulties, researchers have developed various instruments like James Webb Space Telescope (JWST) and Laser Interferometer Space Antenna (LISA), which can sustain such conditions and higher prices. These factors are expected to hamper the advanced optics market growth.

Advanced Optics Market Segmentation Analysis

By Technology Analysis

Quantum Optics Segment to Witness Fast Pace Growth Owing to Rising Investments in Development of Energy Efficient Solutions

Based on technology, the market is divided into ray optics, wave optics, and quantum optics.

Quantum optics segment is estimated to be the largest segment in the base year. This segment is also projected to be the fastest-growing segment during 2024-2032. Rising investment in the development of energy-efficient advanced photonics solutions is anticipated to fuel the market growth. In addition, the rising demand for quantum optics solutions by several end-use industries, including telecommunication, semiconductor, medical, defense, and space, supports expanding the market size during the projection period.

The wave optics segment held the lowest market share in 2020. However, the segment is expected to witness significant growth during the forecast period. Increased demand for Light Detection and Ranging (LiDAR) solutions from the defense industry is expected to support the market growth.

By Application Analysis

Optical Communication Segment to Grow at Higher CAGR Owing to Growing Smart City Projects

Based on application, the market is classified into LiDAR, lighting solutions, optical communication, Intelligence, Surveillance & Reconnaissance (ISR), medical equipment, cameras, metrology devices, 3D scanners, and others.

The lighting solution segment registered the largest market share in 2023 and is anticipated to remain dominant throughout the forecast period. The growing smart city projects worldwide are propelling the demand for advanced LED lighting solutions with control technology. In addition, the rising use of optical laser light-enabled systems for precision manufacturing is anticipated to boost the market growth. The segment's growth is further driven by the declining cost-per-watt of LEDs and higher value-adds in smart and human-centric lighting systems.

The optical communication segment is expected to grow at the highest compound annual growth rate during the projection period. The segment's growth is attributed to the increasing development in the telecommunication industry. The surge in demand for advanced optical network solutions to enhance performance is anticipated to boost market growth. Moreover, the growing penetration of 5G technology fuels the demand for optical communication solutions.

By End-use Industry Analysis

Commercial Segment Dominated the Market Growing Adoption of Optical Solutions in 2023

Based on the end-use industry, the market is divided into commercial, industrial, defense, medical, aviation (drone), automotive, space, and others.

The commercial segment registered the largest share of the market in 2023. The segment's dominance is due to the growing adoption of advanced photonics and other optical solutions for displaying pictures, lighting, mobile displays, AR/VR devices, and other consumer devices. In addition, the growing smart city projects in high-growth regions boost demand for optical LED lights.

The industrial segment held a significant share in the base year due to the growing semiconductor, telecommunication industries, and manufacturing industries worldwide. The rising adoption of Industry 4.0 technology drives the demand for advanced optical solutions for industrial applications.

The space end-use industry is projected to be the fastest-growing segment during the forecast period. Increasing satellite launches and investments in space research and development activities are anticipated to propel the market growth.

REGIONAL INSIGHTS

The global advanced optics market is segmented into North America, Europe, Asia-Pacific, and the Rest of the World based on region.

Asia Pacific dominated the market in 2023. The market size stood at USD 117.70 billion in 2023 and is estimated to grow at the highest growth rate during the forecast period. The presence of several OEMs in China, Japan, India, South Korea, and Australia is anticipated to surge the market growth during 2024-2032. In addition, the growing smart city projects and developing telecommunication, aviation, defense, healthcare, and semiconductor industries in the mentioned countries will support the market growth during the forecast period.

North America registered a significant share in 2023. The rise in the adoption of advanced optical technology, such as quantum optics in defense, aviation, and the industrial and commercial industry, is anticipated to fuel the market growth in North America. In addition, large defense spending and the presence of several key players market growth in North America.

The market in Europe is projected to grow at a significant growth rate during the forecast period. Increasing semiconductor, healthcare, automotive, and manufacturing industries in the U.K., Germany, and France are expected to drive market growth in Europe.

The market in the Rest of the World has witnessed slow growth amid the pandemic due to disruption in supply chain management. However, an increase in the adoption of photonics solutions to develop modern infrastructure in Saudi Arabia, and the UAE is expected to create lucrative growth opportunities in the market in upcoming years.

List of Key Companies in Advanced Optics Market

Constant Product Innovation and Development Strategies Adopted by Corning Inc. to Endure position

Corning Inc. is a pioneer in developing advanced optics for industrial & scientific operations, ceramics, specialty glass, and related materials. The strong focus on R&D activities and product innovation to provide a variety of products to the customers can support the company to withstand its market position.

The other key players involved in the market focus on adopting advanced technologies such as artificial intelligence to enhance the production of highly efficient optical systems and components.

LIST OF KEY COMPANIES PROFILED:

• Signify N.V. (Netherlands)


• Shin-Etsu Chemical Co. Ltd (Japan)


• Nikon Corporation (Japan)


• Cisco Systems Inc. (U.S.)


• Corning Inc. (U.S.)


• Hoya Corporation (Japan)


• Schott AG (Germany)


• II-VI Inc. (U.S.)


• GlobalFoundries Inc. (U.S.)


• AGC Inc. (Japan)


• Hamamatsu Photonics K.K. (Japan)


• Gooch & Housego PLC (U.K.)


• Excelitas Technologies Corp. (U.S.)


• Imagine Optic SA (France)


• Iris AO, Inc (U.S.)


• Boston Micromachines Corporation (U.S.)


• Flexible Optical B.V. (Netherlands)


• Active Optical Systems, LLC (U.S.)


• Northrop Grumman Corporation (U.S.)

KEY INDUSTRY DEVELOPMENTS:

• March 2024 – STL, a leading global optical and digital solutions firm, would demonstrate its incorporated capability to manufacture optical products, which include its own glass preform to optical connectivity products, illustrating its commitment to building advanced fiber optic networks throughout Europe.


• March 2024 – Broadcom Inc., one of the leading suppliers and manufacturers of fiber optic components, announced a number of significant accomplishments which extend its market leadership with an expanded line of optical interconnect solutions for artificial intelligence (AI) and machine learning (ML) applications. Broadcom's advanced optics solutions offer high-speed interconnects throughout the front-end and back-end networks of large-scale generative AI compute groups.


• September 2023 – Intelsat and Aalyria announced its collaboration project in which both the companies would aim on delivering. The project would enable increased mobile broadband connections and is another step forward toward the Next Generation Unifying Network vision enabled by software-defined networking, 5G, and multi-orbit operations.


• July 2023 – Frontiers announced the acquisition of Advanced Optical Technologies (AOT) magazine. Frontiers is dedicated to open science and the acquisition of AOT is a vital step toward achieving this goal in optical design, engineering, and manufacturing.

REPORT COVERAGE

The advanced optics market report provides a detailed analysis of the market and focuses on key aspects such as products, company profiles of key manufacturers, demanding technologies, and end-use industry. Moreover, the market research report offers insights into the advanced optics trends, competitive landscape, and highlights key industry developments. In addition to the factors mentioned above, the market report encompasses several direct and indirect factors that have contributed to the market growth in recent years.

Report Scope & Segmentation