Audio CODEC Market Expected to Reach $14.12 Billion By 2027

According to a new report published by Allied Market Research, titled, “Audio CODEC Market By Function and End Use: Opportunity Analysis and Industry Forecast, 2020–2027”, the audio CODEC market size was valued at $11.44 billion in 2019, and is projected to reach at $14.12 billion by 2027, growing at a CAGR of 4.1% from 2020 to 2027. Asia-Pacific is expected to be the leading contributor to the global audio CODEC market share, followed by North America and Europe.

Audio CODECs include both analog-to-digital (ADCs) convertors and digital-to-analog (DACs) convertors on a single chip. The fundamental function of audio CODEC is to convert analog to digital signal and decode digital to analog signals with sufficient signal-to-noise ratio. It offers best harmonic distortion integrated with low power. A new generation of audio CODECs with high performance enhance audio functionality and sound quality for next-generation portable devices. It supports a wide range of productivity and consumer electronics uses while retaining its energy efficiency. 

Surge in smartphone adoption mainly drives growth of the audio CODEC market to deliver seamless performance of audio communication. Moreover, demand for energy efficient audio system, emergence of IoT-enabled devices, and rise in per capita income are expected to boost the market growth. Furthermore, surge in demand for automotive infotainment, adoption of virtual reality technology, and growth in demand for gaming consoles are expected to provide lucrative growth opportunities for the market. However, emergence of SoC is expected to hinder growth of the market.

The phones segment was the highest contributor to the market in 2019. The phones and tablets segments collectively accounted for around 50.0% market share in 2019, owing to rise in demand for smartphones. 

Emergence of COVID-19 has significantly impacted the audio CODEC market growth. End users of audio CODEC represent mixed trends during the COVID-19 pandemic. Industry verticals such as consumer electronics show minimal demand. However, demand from the healthcare sector remained unaffected.

Region wise, the audio CODEC market trends have been analyzed across North America, Europe, Asia-Pacific, and LAMEA. Asia-Pacific accounted for a major share of the global market in 2019, and is expected to dominate the market, in terms of revenue, during the forecast period, owing to high demand for end use products such as smartphones, portable devices, over-ear headphones, and TWS. North America holds the second largest share in the global market, and is expected to witness significant growth during the forecast period, owing to presence of significant number of market players in the region. 

Key Findings of the Study

• In 2019, the without DSP segment accounted for the maximum revenue and is projected to grow at a notable CAGR of 4.9% during the forecast period.
• The smart home and IoT segment together accounted for around 10.0% of the audio CODEC market share in 2019.
• Phones contributed major share of 44.0% in global audio CODEC market analysis during 2019.
• U.S. was the major shareholder in the North America region, accounting for more than 20% share in 2019.

The key players profiled in the report include Analog Devices, Cirrus Logic, CML Microelectronics, Dialog Semiconductor, DSP Group, Maxim Integrated, Realtek Semiconductor, ROHM CO., LTD., STMicroelectronics, and Texas Instruments. These market players have adopted various strategies such as product launch, collaboration & partnership, joint venture, and acquisition to expand their foothold in the audio CODEC industry.