Semiconductor in Military and Aerospace

Global Semiconductor in Military and Aerospace Market to Reach US$16.0 Billion by 2030

The global market for Semiconductor in Military and Aerospace estimated at US$12.1 Billion in the year 2024, is expected to reach US$16.0 Billion by 2030, growing at a CAGR of 4.8% over the analysis period 2024-2030. Microprocessors, one of the segments analyzed in the report, is expected to record a 6.2% CAGR and reach US$7.2 Billion by the end of the analysis period. Growth in the Analog Semiconductors segment is estimated at 3.1% CAGR over the analysis period.

The U.S. Market is Estimated at US$3.2 Billion While China is Forecast to Grow at 4.6% CAGR

The Semiconductor in Military and Aerospace market in the U.S. is estimated at US$3.2 Billion in the year 2024. China, the world`s second largest economy, is forecast to reach a projected market size of US$2.6 Billion by the year 2030 trailing a CAGR of 4.6% over the analysis period 2024-2030. Among the other noteworthy geographic markets are Japan and Canada, each forecast to grow at a CAGR of 4.6% and 4.1% respectively over the analysis period. Within Europe, Germany is forecast to grow at approximately 3.8% CAGR.

Global Semiconductors in Military and Aerospace Market - Key Trends & Drivers Summarized

Why Are Semiconductors Becoming Strategic Assets in Defense and Aerospace Domains?
Semiconductors serve as the backbone of modern defense systems and aerospace applications, powering everything from advanced radar and communications to satellite navigation, missile guidance, and cyber defense. As military and aerospace systems evolve toward greater automation, data processing, and electronic warfare capability, the demand for high-performance, radiation-hardened, and ultra-reliable semiconductor components is becoming critical. The integration of artificial intelligence (AI), real-time sensor fusion, autonomous platforms, and electronic countermeasures into next-gen defense systems necessitates semiconductor designs that exceed commercial-grade tolerances and lifecycle expectations.

Defense contractors, space agencies, and air force command centers now rely on application-specific integrated circuits (ASICs), field-programmable gate arrays (FPGAs), power amplifiers, and microcontrollers tailored for harsh conditions such as high radiation, temperature extremes, and mechanical stress. These chips must offer mission-critical reliability under zero-maintenance conditions, sometimes lasting 10-20 years. The strategic importance of semiconductors in national security has also led to increased focus on domestic supply chain resilience, export control policies, and government-funded R&D programs aimed at securing sovereign technology capability.

What Technological Innovations Are Shaping Military-Grade Semiconductor Performance?
The semiconductor requirements for defense and aerospace systems go far beyond consumer-grade functionality. Key innovations include the development of radiation-hardened-by-design (RHBD) chips that can withstand cosmic rays and high-energy particles encountered in space or high-altitude flight. These components are engineered using silicon-on-insulator (SOI), gallium nitride (GaN), and silicon carbide (SiC) materials for superior heat resistance, switching speed, and power efficiency. GaN-based RF devices are particularly valuable in radar systems and electronic warfare for their ability to handle high-frequency signals with minimal loss.

Additionally, secure embedded processors and encrypted microcontrollers are now standard in mission-sensitive platforms to prevent cyber intrusion and hardware-level tampering. AI chips and neuromorphic processors are under exploration for edge computing in unmanned systems and ISR (intelligence, surveillance, reconnaissance) payloads, enabling autonomous decision-making in denied environments. 3D packaging and chiplet architectures are improving power density and reducing the size and weight of avionics systems-an essential factor in aircraft, drones, and satellites. These innovations are not only increasing system performance but also enhancing survivability and agility in modern warfare scenarios.

Which Application Areas and Global Defense Initiatives Are Fueling Demand?
Semiconductors are foundational to a broad range of military and aerospace platforms, including fighter jets, unmanned aerial vehicles (UAVs), precision-guided munitions, satellites, armored vehicles, and naval defense systems. In the aerospace domain, semiconductors enable critical avionics, navigation, satellite communications, and space exploration systems. In defense, semiconductors power advanced radar arrays, missile defense shields, and real-time battlefield communication systems. The push for network-centric warfare and multi-domain operations has expanded the role of semiconductors in ensuring interoperability, rapid decision-making, and situational awareness.

Geopolitical tensions and increasing defense budgets are driving semiconductor demand across the United States, China, India, Israel, and NATO member countries. The U.S. Department of Defense has launched several initiatives under the CHIPS and Science Act to enhance domestic semiconductor manufacturing capacity and secure access to radiation-hardened and defense-grade chips. In Europe, joint defense procurement programs and space technology investments are encouraging indigenous development of military-grade chips. India is investing in secure chip design and fabrication as part of its defense indigenization and space technology expansion. Global conflicts, space race dynamics, and electronic warfare threats are all fueling the urgency to secure and scale high-reliability semiconductor supply.

What Are the Primary Growth Drivers for Semiconductors in Military and Aerospace Markets?
The growth in the semiconductors in military and aerospace market is driven by several factors, including escalating global defense spending, rising deployment of AI and autonomous systems, and increased emphasis on secure, indigenous semiconductor supply chains. National security considerations are compelling governments to fund domestic chip manufacturing and reduce dependency on foreign fabs, especially for high-assurance components used in sensitive systems. The proliferation of advanced missile defense networks, unmanned combat vehicles, and satellite-based surveillance is further elevating semiconductor demand across both hardware and embedded systems.

With space exploration expanding through both government and private entities, there is a growing need for long-life, high-reliability chips that can operate in extreme environments. The introduction of digital twins, sensor fusion, and AI-driven battlefield analysis is increasing the data processing load on deployed systems, necessitating powerful, low-latency chips. Moreover, the move toward electrification and hybrid propulsion in aerospace platforms also drives power semiconductor demand. As defense systems become more digital, mobile, and interconnected, the demand for military-grade semiconductors will continue to grow, reinforced by the need for secure, domestically manufactured, and future-ready electronic components.

SCOPE OF STUDY:

The report analyzes the Semiconductor in Military and Aerospace market in terms of units by the following Segments, and Geographic Regions/Countries:

Segments:
Type (Microprocessors, Analog Semiconductors, Digital Signal Processors, Field Programmable Gate Arrays, Application-Specific Integrated Circuits); Application (Communication Application, Surveillance Application, Radar Application, Navigation Application, Electronic Warfare Application); End-Use (Aerospace End-Use, Land End-Use, Naval End-Use, Cybersecurity End-Use, Intelligence End-Use)

Geographic Regions/Countries:
World; United States; Canada; Japan; China; Europe (France; Germany; Italy; United Kingdom; and Rest of Europe); Asia-Pacific; Rest of World.

Select Competitors (Total 32 Featured) -

• Advanced Micro Devices (AMD)
• Analog Devices (ADI)
• BAE Systems
• Broadcom Inc.
• Diodes Incorporated
• Infineon Technologies AG
• Intel Corporation
• KCB Solutions
• Microchip Technology (Microsemi)
• NXP Semiconductors
• Northrop Grumman
• ON Semiconductor (onsemi)
• Qualcomm Inc.
• Raytheon Technologies
• Semtech Corporation
• Skyworks Solutions
• STMicroelectronics
• Teledyne Technologies
• Texas InstrumentsToshiba Corporation
• Xilinx (now AMD)

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