| REPORT ATTRIBUTE |
DETAILS |
| Historical Period |
2020-2023 |
| Base Year |
2024 |
| Forecast Period |
2025-2032 |
| System on Module Market Size 2024 |
USD 2948 million |
| System on Module Market, CAGR |
11% |
| System on Module Market Size 2032 |
USD 6793.77 million |
Market Overview:
System on Module Market size was valued at USD 2948 million in 2024 and is anticipated to reach USD 6793.77 million by 2032, at a CAGR of 11% during the forecast period (2024-2032).
Key drivers fueling the System on Module (SoM) market include the increasing adoption of IoT-based technologies and the surge in demand for embedded systems that offer superior computing performance with ultra-low power consumption. The market benefits from the growing requirements for automation in industrial processes, the expansion of smart and energy-efficient electronic products, and the integration of AI and machine learning capabilities into embedded modules. Additionally, the shift towards 5G connectivity, the expansion of the IoT ecosystem, and the focus on real-time data processing further accelerate market growth. SoMs offer significant advantages such as reduced baseboard costs, design reusability, and reliable platforms for rapid development, making them highly attractive for diverse applications. Notably, the increasing trend toward modular hardware design is enabling faster time-to-market for OEMs and system integrators, further strengthening the market’s growth trajectory.
Regionally, Asia Pacific leads the global SoM market, propelled by a thriving electronics manufacturing sector in countries like China, Japan, South Korea, and Taiwan. The region’s rapid adoption of IoT devices, smart home applications, and industrial automation solutions contributes significantly to market expansion. The presence of a robust supply chain and government initiatives supporting high-tech manufacturing further enhance the region’s competitive edge. North America follows closely, with strong demand from automotive, healthcare, and industrial automation sectors, supported by technological innovation and substantial R&D investments. The region also benefits from a high concentration of leading technology firms and a strong focus on innovation in embedded solutions. Europe demonstrates steady growth, particularly in the automotive and industrial automation segments, with Germany, France, and the UK being key contributors. Strategic collaborations between industry players and research institutions are fostering innovation and adoption of advanced SoM solutions across the continent.
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Market Insights:
- The System on Module (SoM) market was valued at USD 2,948 million in 2024 and is projected to reach USD 6,793.77 million by 2032, registering a CAGR of 11% during the forecast period.
- Rapid adoption of IoT-based technologies and demand for embedded systems with high computing performance and low power consumption drive sustained market growth.
- Automation in industrial processes and the expansion of smart, energy-efficient electronic products increase the need for advanced SoM solutions across manufacturing, automotive, and consumer sectors.
- Integration of AI, machine learning, and 5G connectivity into embedded modules enables real-time data processing and supports the development of intelligent devices for mission-critical applications.
- System on Module platforms offer advantages such as reduced baseboard costs, design reusability, and faster time-to-market, making them attractive for OEMs and system integrators.
- Asia Pacific leads the global market with a 44% share, followed by North America at 28% and Europe at 21%, reflecting strong regional adoption and investment in next-generation technologies.
- The market faces challenges including complex integration with legacy systems, compatibility issues, supply chain disruptions, and fluctuating component prices, which require robust strategies for sustained growth.
Market Drivers:
Surge in IoT Adoption Drives Embedded System Demand
The System on Module Market benefits from the rapid expansion of IoT-based technologies across diverse industries. Enterprises seek compact and energy-efficient embedded computing solutions to support smart devices and connected infrastructure. It enables seamless integration of sensors, controllers, and communication modules into industrial, automotive, and consumer applications. The proliferation of smart homes, factories, and cities underscores the demand for scalable and adaptable embedded platforms. Organizations prioritize solutions that deliver high performance without compromising power efficiency. The System on Module Market addresses these needs by offering flexible and robust modules that streamline device development and deployment.
Automation and Industrial Digitization Fuel Market Growth
Automation in manufacturing and industrial processes continues to accelerate, propelling the System on Module Market forward. Companies aim to optimize operations, reduce human error, and enhance productivity through advanced automation systems. It provides the computational backbone for robotics, process control, and real-time data analysis in smart factories. The integration of machine learning and artificial intelligence into industrial equipment requires reliable and scalable embedded platforms. Businesses value the System on Module Market for its ability to support rapid prototyping and efficient scaling of automated solutions. The trend toward digital transformation in manufacturing ensures sustained demand for advanced embedded modules.
- For instance, Deloitte’s 2025 Smart Manufacturing and Operations Survey found that 552 out of 600 large U.S. manufacturers surveyed believe smart manufacturing will be the main driver for competitiveness over the next three years.
Advancements in Connectivity and Real-Time Processing
The shift toward 5G connectivity and the need for real-time data processing create new opportunities for the System on Module Market. High-speed, low-latency networks enable seamless communication between devices and cloud platforms, supporting mission-critical applications. It empowers developers to design systems capable of instant data acquisition, analysis, and response. Industries such as healthcare, automotive, and logistics rely on real-time insights to improve outcomes and operational efficiency. The System on Module Market delivers solutions that meet stringent connectivity and processing requirements. Its modular approach shortens development cycles and enhances system flexibility.
- For instance, Telkomsel’s 5G-based smart manufacturing solution, deployed in Batam City, Indonesia, enabled one multinational manufacturer to eliminate the need for weekly managerial reports and equip staff with virtual reality headsets for real-time machinery maintenance.
Design Reusability and Accelerated Time-to-Market
The System on Module Market stands out for its advantages in design reusability and rapid product development. Original Equipment Manufacturers (OEMs) and system integrators leverage modular hardware to reduce baseboard costs and simplify upgrades. It enables businesses to adapt quickly to evolving technology standards and customer needs. The ability to reuse proven designs across multiple projects minimizes risk and accelerates innovation. Companies value the System on Module Market for supporting scalable and customizable solutions. Its role in shortening time-to-market strengthens its appeal across sectors seeking competitive advantage.
Market Trends:
Integration of AI and Edge Computing Shapes Product Innovation
The System on Module Market experiences significant momentum from the integration of artificial intelligence (AI) and edge computing capabilities. Manufacturers and developers seek modules that support advanced data analytics, machine learning, and real-time decision-making at the device level. It enables the deployment of intelligent applications in sectors such as industrial automation, healthcare, and automotive, where low latency and high reliability are critical. The market witnesses a shift toward modules equipped with dedicated AI accelerators and enhanced processing power. These features facilitate the development of smart devices capable of complex tasks without relying on cloud infrastructure. The System on Module Market continues to evolve, with vendors introducing solutions tailored for edge AI workloads and demanding embedded environments.
- For instance, in April 2024, Digi International introduced the Digi ConnectCore MP25 System on Module, powered by the STMicroelectronics STM32MP35 processor, specifically designed for advanced computer vision applications in industrial, medical, and transportation sectors.
Growing Demand for Modular and Scalable Embedded Solutions
The trend toward modularity and scalability drives innovation in the System on Module Market. Businesses prioritize platforms that allow for easy customization and rapid adaptation to changing technological requirements. It supports a wide range of applications by offering standardized form factors and flexible interfaces. The market sees increased adoption of modules that simplify integration, reduce development time, and lower overall system costs. Companies value the ability to upgrade or modify embedded systems without redesigning the entire hardware architecture. The System on Module Market responds to these needs by delivering solutions that enhance product lifecycle management and support long-term technology roadmaps.
- For instance, NXP Semiconductor launched a scalable wireless MCU series in April 2024 to address industrial and IoT challenges, allowing companies to flexibly upgrade their embedded solutions as technology needs evolve.
Market Challenges Analysis:
Complex Integration and Compatibility Issues Hinder Adoption
The System on Module Market faces challenges related to complex integration and compatibility with diverse hardware and software environments. Developers encounter difficulties aligning SoM solutions with legacy systems and proprietary interfaces, which can increase project timelines and costs. It often requires extensive customization to ensure seamless performance across various applications. The lack of universal standards complicates module selection and system design for end users. Companies may hesitate to adopt new modules when integration risks threaten operational stability. The System on Module Market must address these technical barriers to accelerate broader acceptance.
- For instance, Digi International’s ConnectCore SOMs offer seamless integration with the Digi XBee® ecosystem and support a wide range of connectivity protocols, including pre-certified Wi-Fi, Bluetooth, LTE cellular, and mesh networking, which allows OEMs to rapidly prototype and deploy solutions with minimal compatibility issues.
Supply Chain Constraints and Cost Pressures Impact Growth
The System on Module Market also contends with supply chain disruptions and fluctuating component prices. Global shortages of semiconductors and critical electronic parts can delay production schedules and limit product availability. It places pressure on manufacturers to secure reliable sources while maintaining cost competitiveness. Price volatility affects both small and large enterprises, potentially slowing innovation and market expansion. Companies must balance quality, lead times, and budget constraints when sourcing modules. The System on Module Market needs robust supply chain strategies to sustain growth in a dynamic global environment.
Market Opportunities:
Expansion of IoT and Smart Applications Creates New Growth Avenues
The System on Module Market stands to benefit from the rapid expansion of IoT and smart applications across multiple industries. Demand for connected devices in sectors such as healthcare, transportation, and industrial automation continues to rise. It enables the development of compact, energy-efficient solutions that support real-time data processing and remote management. The market can capitalize on opportunities in smart cities, wearable technology, and intelligent infrastructure projects. Companies seek modules that simplify integration and accelerate time-to-market for next-generation products. The System on Module Market is well positioned to address these evolving requirements with flexible and scalable solutions.
Advancements in AI and Edge Computing Drive Value Creation
The growing adoption of AI and edge computing presents significant opportunities for the System on Module Market. Businesses require embedded platforms capable of handling complex analytics and machine learning directly at the device level. It supports applications in autonomous vehicles, predictive maintenance, and advanced robotics, where low latency and high reliability are essential. The market can leverage these trends to deliver high-performance modules tailored for demanding environments. Companies that invest in AI-enabled SoMs can differentiate their offerings and capture emerging market segments. The System on Module Market has the potential to drive innovation and support digital transformation across industries.
Market Segmentation Analysis:
By Application Domain
The System on Module Market serves diverse application domains, with industrial automation, automotive, healthcare, and consumer electronics representing the largest segments. Industrial automation leads demand, driven by the need for robust embedded platforms in smart factories and process control systems. Automotive applications focus on advanced driver assistance systems, infotainment, and electric vehicle platforms, leveraging SoMs for high-performance and reliability. Healthcare relies on SoMs for medical imaging, diagnostics, and portable monitoring devices, while consumer electronics benefit from compact modules in smart home and wearable devices.
By Integration Level
The market segments by integration level into FPGA-based, ARM-based, and x86-based modules, each catering to specific performance and application needs. ARM-based SoMs dominate due to their balance of power efficiency and computational capability, making them suitable for IoT, industrial, and portable applications. FPGA-based modules target industries requiring high customization and parallel processing, such as telecommunications and defense. x86-based SoMs serve applications demanding compatibility with legacy systems and high-end computing, including industrial PCs and automation controllers.
- For instance, AMD introduced its 5th Gen EPYC Embedded 9005 Series CPUs in March 2025, optimized for embedded markets and adopted by companies like Cisco and IBM to power next-generation networking, storage, and industrial edge systems.
By Form Factor
Form factor segmentation highlights Qseven, COM Express, SMARC, and custom modules as key categories. Qseven and SMARC formats gain traction in compact, low-power applications like IoT gateways and portable devices. COM Express remains prevalent in high-performance, scalable systems for industrial and transportation sectors. The System on Module Market adapts to evolving requirements by offering flexible form factors that support rapid integration, scalability, and long-term product lifecycle management.
- For instance, the COM Express Basic Type 6 module from Kontron, measuring 125 x 95 mm, is utilized in industrial automation and medical imaging equipment, supporting advanced Intel Core and Xeon CPUs for demanding applications.
Segmentations:
By Application Domain
- Industrial Automation
- Automotive
- Healthcare
- Consumer Electronics
- Aerospace & Defense
- Transportation
- Others
By Integration Level
- ARM-based SoM
- FPGA-based SoM
- x86-based SoM
- DSP-based SoM
By Form Factor
- Qseven
- COM Express
- SMARC
- ETX
- Custom Modules
By Processing Power
- Low Power
- Mid Power
- High Power
By Region
- North America
- Europe
- Germany
- France
- U.K.
- Italy
- Spain
- Rest of Europe
- Asia Pacific
- China
- Japan
- India
- South Korea
- South-east Asia
- Rest of Asia Pacific
- Latin America
- Brazil
- Argentina
- Rest of Latin America
- Middle East & Africa
- GCC Countries
- South Africa
- Rest of the Middle East and Africa
Regional Analysis:
Asia Pacific Leads with Strong Manufacturing and IoT Adoption
Asia Pacific accounts for 44% of the global System on Module Market, making it the largest regional market. China, Japan, South Korea, and Taiwan maintain advanced production capabilities and invest heavily in smart factories and connected infrastructure. It benefits from a skilled workforce, strong supply chain networks, and supportive government policies that encourage high-tech innovation. The region’s focus on industrial automation, consumer electronics, and automotive applications fuels sustained demand for embedded modules. Companies in Asia Pacific deploy SoMs to accelerate product development and maintain competitiveness in global markets. The System on Module Market continues to expand its footprint as regional players invest in next-generation technologies.
North America Advances with Innovation and High-Value Applications
North America holds a 28% share of the global System on Module Market, positioning it as a key region for growth and innovation. The United States and Canada drive demand through advanced applications in healthcare, automotive, aerospace, and industrial automation. It benefits from the presence of leading technology firms and a mature ecosystem for embedded solutions. The region’s emphasis on AI, edge computing, and cybersecurity creates opportunities for high-performance SoMs tailored to mission-critical environments. Companies leverage these modules to accelerate digital transformation and meet evolving customer needs. The System on Module Market in North America is well positioned for sustained growth as industries pursue greater efficiency and intelligence.
Europe Focuses on Industrial and Automotive Transformation
Europe represents 21% of the global System on Module Market, reflecting steady growth and a strong emphasis on industrial and automotive innovation. Countries such as Germany, France, and the United Kingdom invest in smart manufacturing, electric vehicles, and connected infrastructure. It benefits from collaborative initiatives between industry leaders, research institutions, and government agencies. The region prioritizes sustainability, safety, and regulatory compliance, driving demand for reliable and energy-efficient embedded modules. Companies in Europe adopt SoMs to support next-generation automotive platforms and advanced industrial systems. The System on Module Market finds opportunities in Europe’s commitment to digitalization and green technologies.
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Key Player Analysis:
- Aaeon
- Toradex
- Kontron
- Congatec
- MSC Technologies (Avnet)
- Technexion
- Phytec
- Advantech
- ADLink
- Portwell
- EMAC
- Avalue Technology
- Eurotech
- SECO srl
- Axiomtek
Competitive Analysis:
The System on Module Market features intense competition among global and regional players that focus on innovation, product differentiation, and strategic partnerships. Leading companies invest in advanced SoM platforms with enhanced processing power, energy efficiency, and support for AI and edge computing applications. It sees established firms such as Kontron, Advantech, Congatec, and SECO competing on performance, reliability, and scalability. New entrants and niche providers target specialized applications through custom modules and flexible integration options. The market rewards companies that offer comprehensive support, rapid prototyping, and long-term product lifecycle management. Pricing pressure, supply chain resilience, and the ability to address diverse industry requirements shape competitive positioning. The System on Module Market continues to evolve as players expand portfolios, strengthen distribution networks, and respond to shifting customer demands.
Recent Developments:
- In May 2025, Congatec announced an expanded manufacturing partnership with Kontron to strengthen its global presence and address international trade disruptions.
- In January 2024, Avnet (parent of MSC Technologies) launched the MSC C10M-ALN module, a COM Express Type 10 module featuring the Intel Atom x7000E series.
- In March 2025, Advantech launched SQFlash PCIe Gen.5 SSDs and EDSFF storage solutions for data centers.
Market Concentration & Characteristics:
The System on Module Market demonstrates moderate market concentration, with a mix of established multinational corporations and agile regional players shaping the competitive landscape. It features strong innovation cycles, rapid adoption of new technologies, and a focus on high-performance, energy-efficient solutions. Leading companies hold significant market share through advanced product portfolios and global distribution networks, while smaller firms address niche requirements with specialized modules. The market values flexibility, design reusability, and scalability, which drive continuous product development. Customer demand for reliable support, customization, and long-term availability influences vendor selection. The System on Module Market remains dynamic, with ongoing consolidation and partnership activities as players seek to strengthen their positions.
Report Coverage:
The research report offers an in-depth analysis based on Application Domain, Integration Level, Form Factor, Processing Power and Region. It details leading market players, providing an overview of their business, product offerings, investments, revenue streams, and key applications. Additionally, the report includes insights into the competitive environment, SWOT analysis, current market trends, as well as the primary drivers and constraints. Furthermore, it discusses various factors that have driven market expansion in recent years. The report also explores market dynamics, regulatory scenarios, and technological advancements that are shaping the industry. It assesses the impact of external factors and global economic changes on market growth. Lastly, it provides strategic recommendations for new entrants and established companies to navigate the complexities of the market.
Future Outlook:
- The System on Module market will see increased adoption of AI-enabled embedded systems, driving innovation across industrial, automotive, and healthcare sectors.
- Edge computing will become a core application area, with SoMs enabling real-time data processing and analytics at the device level.
- Customization and configurability will remain top priorities, allowing manufacturers to tailor modules for diverse and rapidly evolving end-use cases.
- Integration of advanced connectivity standards, including 5G and next-generation wireless protocols, will expand the range of mission-critical applications.
- Security features and cybersecurity compliance will grow in importance, with SoMs incorporating robust hardware and software protections.
- Power efficiency and green manufacturing practices will shape product development, supporting sustainability goals in electronics production.
- The migration to open architectures such as RISC-V will offer new opportunities for innovation and cost optimization.
- Industry demand for rapid prototyping and accelerated time-to-market will drive the adoption of modular, reusable design principles.
- Supply chain resilience and regional diversification of manufacturing hubs will become strategic imperatives for market participants.
- Collaboration between technology firms, research institutions, and end users will foster the development of next-generation SoM solutions for emerging applications.
