IoT Device Market Report Scope & Overview:

The IoT Device Market was valued at USD 110.5 Billion in 2023 and is expected to reach USD 537.6 Billion by 2032, growing at a CAGR of 19.24% from 2024-2032.

In 2023, IoT device shipments by region indicated Asia Pacific as the dominant market, driven by rapid industrial automation and smart city projects, while North America and Europe showed steady growth in enterprise IoT adoption. Connectivity trends in IoT revealed a shift from traditional cellular networks to advanced 5G and LPWAN technologies, enabling faster data transmission and energy-efficient communication. Edge vs. Cloud processing adoption demonstrated an increasing reliance on edge computing to reduce latency, enhance security, and enable real-time processing, particularly in industrial and healthcare IoT applications. IoT supply chain and component sourcing metrics reflected ongoing semiconductor shortages, leading to increased diversification of suppliers and localized manufacturing to reduce dependency on single-source production and ensure resilience against supply chain disruptions.

Market Dynamics

Drivers

• Growing adoption of smart devices and Industry 4.0 is accelerating IoT deployment across various sectors.

The introduction of IoT in smart homes, industrial automation, and connected healthcare, among others, is facilitating market growth. Industry 4.0 initiatives prioritize automation and monitoring with decision-making in real-time, thus driving the demand for IoT devices both in manufacturing and logistics applications. Further, AI, 5G and Edge Computing for IoT – The benefits IoT bring can be maximized in the AI era by improving the processing capability and connectedness of all IoT devices. Demand for smart appliances, wearables and connected vehicle consumption ensures further expansion. Global governments also support IoT adoption with digital transformation policies, smart city projects, etc., which continue to accelerate the growth trend in the market. All these factors combined make it favourable for IoT devices to grow faster and become mainstream in every aspect of the industry.

Restraints

• Data security and privacy concerns pose significant risks due to vulnerabilities in IoT ecosystems.

As the data generated by IoT devices is enormous, it makes IoT devices a prime target and a serious security concern for cyber threats. With the rise of IoT comes the risks of unwanted access, breaches, and connected device vulnerabilities. Most of the IoT devices do not have strong security protocols, placing them at a high risk of hacking and malware attack. Moreover, compliance with changing data protection laws such as the GDPR and CCPA adds layers of operational complexity to organizations. Security is a very driving factor of IoT solution implementation, and without standardized security frameworks applicable across all IoT ecosystems, effective risk management of IoT is reduced, limiting the uptake of IoT solutions within the most sensitive applications such as healthcare and finance.

Opportunities

• The expansion of 5G and edge computing enhances real-time IoT applications and network efficiency.

With its ultra-low latency, high-speed data transfer, and greater network reliability, the rollout of 5G technology is changing the way we connect IoT devices and enabling new applications. This allows IoT devices to operate more optimally in real-time platforms like driverless cars, remote surgeries, and intelligent buildings. Widespread adoption of edge computing adds additional appeal by reducing latency, bandwidth consumption and dependence on centralized cloud storage. The combination of IoT, 5G and edge computing enables a new generation of applications such as AI-driven automation and predictive maintenance. Companies adopting these technologies are set to enter the competitive environment of IoT technology.

Challenges

• High implementation and maintenance costs hinder widespread IoT adoption, especially for SMEs.

The internet of things has a high cost of entry associated with the devices, their infrastructure, and the deployment of systems they integrate with. Affordability often makes SMEs lose out on widespread adoption. IoT devices also require continuous maintenance, firmware updates, and cybersecurity measures. Even implementation is more complex due to lack of interoperability of various IoT platforms and legacy systems. Adding to this, large-scale IoT deployments are nearly impossible due to network congestion and scalability issues. Addressing these cost-related barriers will not only require targeted Investments but also standardization efforts and low-cost solution development to enable a wider reach of IoT across all sectors.

Segmentation Analysis

By Component

The sensors segment dominated the market and accounted for 45% of revenue share in 2023. Sensors used for data collection in the healthcare, automotive, and industrial automation sectors. Sensors are being adopted due to the rising demand for smart devices, wearables, and predictive maintenance solutions. The proliferation of MEMS technology,  along with low-cost sensor solutions, aids the growth process.

The connectivity IC is expected to register the fastest CAGR as a result of continuously growing 5G, LPWAN, and Wi-Fi 6 for more easily connecting IoT nodes or devices to the cloud. The more interlinked IoT devices are, the more important the efficient transmission of data becomes, particularly when it comes to real-time analytics,  automation, and AI-driven applications. The increasing penetration of edge computing, smart cities, and industrial IoT are further boosting the need for advanced connectivity solutions, thus, the Connectivity ICs segment is one of the fastest-growing segments in the market.

By Connectivity Technology

Wi-Fi IoT devices segment dominated the market and accounted for significant revenue share in 2023, owing to their large-scale use in smart home, industrial automation, and enterprise applications. It has a preference for connected gadgets because of its reliability, high speed for data transfer, and cost-effectiveness. The primary driver due to developments in Wi-Fi 6 and Wi-Fi 7, is anticipated to continue to lead the segment, facilitating faster speed, lower latency, and better efficiency for congested IoT settings.

The cellular connectivity segment is expected to register the fastest CAGR, as a direct result of the fast proliferation of 5G and LPWAN technologies. Driven by applications such as autonomous vehicles with a demand for wide-area, high-speed, low-latency connectivity, and industrial IoT and smart cities, the adoption is snowballing.

By End-Use

The consumer electronics dominated the IoT devices market and accounted for significant revenue share in 2023, owing to growing usage of smart home devices, wearables, and connected appliances. Increased adoption of AI-enabled assistants, smart TVs and IoT-based security systems has fueled the growth of this market. Enablement of IoT with Cloud Computing and AI leads to improvement in delivering services to the user, hence promoting continuous growth.

The healthcare sector is expected to exhibit the fastest CAGR due to rising adoption of remote patient monitoring, telemedicine, and smart medical devices. With growing importance for wearable medical sensors, real-time health tracking and IoT-enabled hospital management solutions market is expected to expand during the estimated timeframe. The healthcare segment is also expected to expand, owing to AI diagnostics, connected healthcare ecosystems, and increasing IoT in elderly care and chronic disease management.

Regional Landscape

Asia-Pacific dominated the market and accounted for 40% of revenue share in 2023, due to continuous digital transformation, growing industrial automation, and adoption of smart technologies. There is a significant investment in IoT-based infrastructure in countries such as China,  India, Japan, etc., such as smart cities, connected transportation and industrial IoT.

The  North America is expected to register the fastest CAGR during the forecast period,  as a result of its strong technological ecosystem, growing investments in IoT-based automation, and swift 5G network deployment. Market growth is being driven by the region's emphasis on IoT combined with AI, edge computing, and cybersecurity.

Key Players

The major key players along with their products are

• Cisco Systems, Inc. – Cisco IoT Control Center

• Intel Corporation – Intel IoT Gateways

• IBM Corporation – IBM Watson IoT Platform

• Qualcomm Technologies, Inc. – Qualcomm Snapdragon IoT

• Microsoft Corporation – Azure IoT Hub

• Google LLC – Google Cloud IoT Core

• Amazon Web Services (AWS) – AWS IoT Core

• Samsung Electronics Co., Ltd. – Samsung SmartThings Hub

• Huawei Technologies Co., Ltd. – Huawei OceanConnect IoT Platform

• Siemens AG – Siemens MindSphere

• Texas Instruments Inc. – TI SimpleLink IoT Solutions

• Bosch IoT Solutions – Bosch IoT Suite

• NXP Semiconductors – NXP EdgeLock SE050 IoT Security Chip

• STMicroelectronics – STMicroelectronics STM32 IoT Discovery Kit

• Ericsson – Ericsson IoT Accelerator

Recent Developments

• December 2024: Synaptics partnered with Google's Alphabet to integrate Google's machine learning core with Synaptics' Astra hardware, aiming to enhance AI capabilities in IoT devices.

• November 2024: Adelaide-based nanosatellite company Myriota announced plans to create 100 high-skilled jobs and expand globally after receiving a $50 million investment to advance its IoT technology.

• October 2024: Chinese company Quectel licensed its IoT cellular module technology to Ohio-based startup Eagle Electronics, reflecting a trend towards onshoring semiconductor manufacturing in the U.S.