Growing use of laser diodes in industry, telecoms to drive market through 2020

Total sales likely to exceed $10 billion by 2020, growing at 11% CAGR over next four years, says analyst Technavio.

The global laser diode market is expected to grow at a CAGR of more than 11% during the period 2016-2020, according to a new market study released by sector analyst Technavio.

The main vendors highlighted in this report include: Coherent; IPG Photonics; OSRAM; Rofin-Sinar Technologies; and Trumpf.

The $2500.00 report, entitled Global Laser Diode Market 2016-2020 provides in-depth analysis of the market in terms of revenue and emerging market trends, split into six segments, several detailed below. The six markets are: industrial; communication and optical storage; military; medical; and instrumentation & sensor.


Technavio says the laser diode market in the industrial segment is likely to reach $4 billion by 2020, also growing at a CAGR of over 11% during the period. The report sates, “In the industrial segment, laser diodes are mostly used for material processing and lithography and for cutting metals and welding plastics as laser diodes have high efficiency, power, and brightness.”

They are also used in laser cladding for depositing powdered metal or wire on a metal substrate. Other applications include plastic welding, brazing, ablation, soldering, and surface hardening.

Asif Gani, a lead analyst at Technavio for embedded systems research, commented, “Laser diodes are efficient, have low investment costs, produce less distorted heat, and have a high processing speed. These factors drive the demand for laser diodes in the industrial segment.”


Sales boost: Individually addressable diode lasers with rear and front facet access

Communications and optical storage

The laser diode market in the communication and optical storage segment is expected to achieve sales of $3.6 billion by 2020, growing at the same rate as military system sales. Laser diodes are preferred in these applications because they are easy to modulate.

Such diodes form an important component of broadband communications. They are also installed as transmitters in fiber optic networks in order to pump lasers in erbium doped amplifiers, and are also used as high-power pulsed lasers in test and measurement applications.

Technavio believes telecommunication industry and its sectors will experience; the report states, “rapid growth worldwide due to rising capital expenditure and improved network quality,” adding, “New technologies will help improve the performance of existing fixed and mobile infrastructure. Semiconductor laser diodes are widely used in this sector and will gain high traction during the forecast period.


The value of the laser diode market in the military segment is expected to exceed $1.8 billion by 2020, also growing at a CAGR of over 11%. In this segment, laser diodes are used in anti-missile systems, airborne laser mine detection systems, illuminators, and solid-state and high-energy laser pump sources. They are also used for range finding and target destination locking.

Technavio analyst Asif Gani said, “Diode lasers are also used to improve the targeting quality of any weapon that uses red laser diode. The military applications in which these diodes are used include beacons and target designation, open-air communication, infrared illumination, 3D alignment, and distance sensing by remote controlled aerial and surface vehicles. In addition, laser diodes are being used for obstacle ranging and mapping applications, which are particularly useful for military helicopters and jets at night.