Application-Specific Integrated Circuit in Japan Trends and Forecast
The future of the application-specific integrated circuit market in Japan looks promising with opportunities in the telecommunication, industrial, automotive, and consumer electronic markets. The global application-specific integrated circuit market is expected to reach an estimated $21.8 billion by 2031 with a CAGR of 5.7% from 2025 to 2031. The application-specific integrated circuit market in Japan is also forecasted to witness strong growth over the forecast period. The major drivers for this market are the rising need for specialized and high-capacity chips and the widespread integration of artificial intelligence and machine learning among industries.
• Lucintel forecasts that, within the product type category, semi-custom will remain the largest segment over the forecast period due to its lower complexity and broad range of applications.
• Within the application category, consumer electronics is expected to witness the highest growth due to the increasing use of application-specific integrated circuits in various gadgets, such as smartphones, tablets, and laptops.
Emerging Trends in the Application-Specific Integrated Circuit Market in Japan
The Japan application specific integrated circuit (ASIC) industry is undergoing a thrilling transformation due to faster technology developments and changing market demand. Major shifts such as the increase in artificial intelligence (AI), the expansion of the 5G ecosystem, and advancements in the automotive and IoT sectors are changing Japan’s position in the semiconductor technology landscape. While Japan embraces semiconductor technology as a whole, there is a constant surge in the availability of specialty optimized ASICs that maximize performance, efficiency, and cost. These trends are expected to augment the overall growth in Japan’s ASIC industry, creating opportunities for a variety of sectors from telecommunications to EVs and smart factories.
• Demand for AI Optimized ASICs Has Skyrocketed: Japanese corporations are developing highly specialized microchips that can meet the tremendous cognitive demands in the realm of AI computation. Demand for ASICs optimized for machine learning, deep learning, and AI is increasing across all industries, particularly in Japan. AI-optimized ASICs are sparking innovation and growth in robotics, healthcare, and finance, where machine learning and data processing efficiency are of utmost importance.
• Expansion of 5G Infrastructure: The 5G network rollout in Japan is creating new opportunities for specialized ASICs. These custom chips are necessary for efficient data transfers, working with higher frequencies, and providing low-latency communication. Telecom corporations in Japan are acquiring ASICs that increase the effectiveness of 5G infrastructure, from base stations to smartphones. The demand for such specialized chips will continue to rise as more industries, such as autonomous vehicles, healthcare, and entertainment, begin to utilize 5G technology and require reliable, high-speed connectivity.
• Development in Automotive ASICs: The rising demand for electric vehicles (EVs) and autonomous driving technology is fueling the Japanese automotive industry’s appetite for specialized vehicle system ASICs. These chips are important for power management, battery control, autonomous driving sensors, and communication systems in EVs. Japanese manufacturers have been focusing on high-performance ASICs tailored to power, efficiency, and safety for the automotive sector. Japan is likely to face increasing demand for these tailored ASICs as the country continues to adopt sustainable automotive solutions.
• Expansion of IoT and Smart Cities: Japan’s application-specific integrated circuits (ASICs) semiconductor designs are increasing due to the expansion of the IoT industry and the growing need in the smart city, healthcare, and industrial automation segments. Specialized microchips used in IoT devices require low energy consumption but high-powered chips for efficient data processing, communication, and sensor integration. For example, in Japan, the growing modernization efforts focused on infrastructure, efficiency, and connectivity have led to increased demand for IoT devices. These microchips enable smarter, more efficient, and responsive cities, rapidly replacing traditional industrial, residential, and commercial IoT applications.
• Shift Towards Energy-Saving ASICs: The growing concern for energy resource management in semiconductor manufacturing has led Japan to increasingly focus on the design and implementation of energy-saving ASICs. The transition to high-performance computing systems, along with AI technology integration into multiple aspects of life, has created great demand for energy-efficient solutions. To achieve higher efficiency, Japanese semiconductor companies are adapting to the growing demand for designing ASICs that use less energy while still performing efficiently. This shift is especially relevant in data centers, the automotive field, and IoT devices, where energy-efficient designs significantly lower operational costs.
The new changes taking place in Japan’s ASIC market suggest that the demand for specialized chips is increasing within the AI, 5G, automotive, IoT, and energy efficiency industries. These trends are driving competition and giving rise to new opportunities for the Japanese semiconductor market. As the pursuit of high-performance and efficient ASICs rises, Tokyo strengthens its hold in the global semiconductor industry, especially on the cutting-edge technology front. Such changes not only affect the Japanese market but also help advance semiconductor technology globally.
Recent Developments in the Application-Specific Integrated Circuit Market in Japan
The Japanese specialized application-specific integrated circuit (ASIC) market is undergoing substantial changes due to continuous advancements in technology and emerging needs in key sectors. These changes are especially pronounced about 5G, electric vehicles (EVs), artificial intelligence (AI), Internet of Things (IoT), and energy-efficient technologies. Japan’s relentless search for innovations within these fields is enabling new boundaries in semiconductor technology, resulting in more sophisticated ASICs. The entire market is gaining vibrancy, offering great potential for both local and foreign investments.
• Surge of Demand for 5G and ASICs: The introduction of 5G in Japan has greatly progressed, leading to surging demand for specialized 5G-capable ASICs that allow for higher data transfer rates. Additionally, telecommunications companies in Japan are heavily investing in ASIC development to ensure network optimization and performance reliability for 5G networks. Furthermore, the enhanced need for 5G is resulting in a simultaneous increase in demand for ASICs in autonomous vehicles and industrial IoT, where high-speed communication with minimal latency is vital for operational efficiency and real-time data processing.
• Increasing Interest in Electric Vehicles (EVs): Japan remains one of the leaders in the global shift to electric vehicles (EVs), along with the rising demand for EV-specific ASICs for power management, battery control, and autonomous driving features. Japanese ASIC manufacturers are focusing on meeting the stringent AEC requirements for EVs, including high performance, extreme energy efficiency, and elevated safety standards. As Japan’s automotive sector continues to progress toward electrification and self-driving cars, the supply of these specialized chips will increase, aiding in the expansion of the semiconductor industry.
• AI-Driven ASIC Development: Japanese semiconductor companies are advancing the development of AI-specific ASIC applications, such as machine learning, deep learning, and neural networks. These chips are designed to serve the high-performance computing needs required for AI tasks, excelling in healthcare, robotics, and financial services. The use of AI provides reliable methods for processing data and making decisions in real time, broadening the scope for the use of AI technologies in Japan. As a result, AI-driven ASICs have become necessary for real-time decision-making, improved data processing, and accelerating the growth of AI in Japan.
• Advances in IoT and Smart Cities: With Japan’s increasing embrace of the emerging Internet of Things (IoT), the need for low-power, high-performance ASICs has skyrocketed. These chips are essential for smart homes, industrial IoT, and smart city infrastructure. There is a parallel drive among Japanese semiconductor companies to design specialized IoT devices with integrated sensors for data processing and communication. The growth of smart cities and digital transformation projects in Japan is fueling growth in this area.
• Concentration on Energy-Efficient ASICs: To address the ongoing challenge of energy consumption, Japanese semiconductor manufacturers are concentrating on developing energy-efficient ASICs for various applications. These chips are custom-tailored for uses such as data centers, electric vehicles, and IoT devices, where performance is critical but so is power consumption. For Japan, these ASICs contribute to sustainability efforts by minimizing environmental impact, reducing costs, and lowering operational expenses.
Japan has experienced a shift in its ASIC market due to advancements in 5G technologies, a surge in electric vehicle sales, faster AI technologies, IoT devices, energy-saving initiatives, and more. All of this is changing the landscape of the semiconductor industry. Through these changes, Japan is emerging as one of the world’s foremost high-tech semiconductor manufacturers and increasing its global competitiveness. As these trends strengthen, Japan’s ASIC market will play a crucial role in promoting innovative solutions across various sectors, such as telecommunications, automotive, and more.
Strategic Growth Opportunities for Application-Specific Integrated Circuit Market in Japan
The ASIC sector in Japan is shifting rapidly as industries begin to adopt custom chips tailored to the latest technologies. The development of 5G networks, electric vehicles, artificial intelligence, Internet of Things, and energy efficiency projects are strong indicators of market growth. As firms work to enhance their quantitative and qualitative output, five growth opportunities across sectors that hold great importance for Japan’s semiconductor industry have been outlined.
• AI-Optimized ASICs: The adoption of AI escalates in sectors such as robotics, healthcare, and finance, making AI-optimized ASICs highly plausible. The chips are designed for deep machine learning and data processing. By applying hardware specialization to AI tasks, ASICs enhance performance, energy efficiency, and computation compared to general chips. Japan’s increased focus on developing its AI ecosystem is expected to boost demand for AI-specific ASICs greatly, leading to advancements in automation and real-time cognitive processing.
• 5G Infrastructure ASICs: The Japanese market for the growth of 5G infrastructure represents a tremendous business opportunity for Japanese ASIC manufacturers. Custom ASICs are in high demand to achieve the speed and low latency data communication that 5G requirements entail. These chips are responsible for processing data in base stations and mobile devices, reaching the 5G level, which is the highest in the industry. As Japan invests vast sums in 5G technology, Ifnet Japan is focused on marketing ASICs designed specifically for 5G networks to maximize returns on investment in the Japanese telecom market. This will accelerate innovations in Japan’s telecom industry and facilitate the faster rollout of smart cities and self-driving cars.
• Automotive ASICs for EVs and Autonomous Vehicles: The shift toward electric vehicles (EVs) and self-driving technology expands the scope of automotive ASICs. Powering the vehicle in electric mode, battery management systems, sensors, and autonomous driving systems all require sophisticated automotive ASICs designed and deployed in EVs. Japanese automotive manufacturers are increasingly investing in the proprietary development of these devices-on-a-chip technology for electric and self-driving cars. Over time, Japan is likely to become a dominant player in the automotive semiconductor market, capitalizing on the soaring demand for these devices as EVs spread globally.
• IoT and Smart City ASICs: The expansion of Smart IoT cities in Japan has led to an increased need for energy-efficient ASICs. These chips are used in a variety of smart IoT devices, including appliances, industrial equipment, and infrastructure management tools for homes, industries, and offices. Japan is also focusing on creating sustainable smart cities and expanding the IoT network, further justifying the increasing demand for energy-efficient ASICs. Japan will see growth in its semiconductor industry as demand increases for these specialized components, essential for IoT systems being adopted by an expanding number of industries.
• Energy-Efficient ASICs: The growing focus on energy sustainability and conservation on a global scale is driving the demand for energy-efficient ASICs. These chips save energy while ensuring the highest standards of performance for data centers, IoT devices, and automotive systems. Japan’s semiconductor manufacturers are seeking to take advantage of this trend by developing energy-efficient ASICs that have a lesser environmental impact while lowering operational costs and system power expenditure, thus increasing efficiency. With energy efficiency becoming imperative for many industries, the demand for energy-efficient ASICs in Japan is expected to grow substantially, supporting the country’s green technology efforts.
Growth opportunities in Japan’s ASIC market are linked to the advancement of AI, 5G infrastructure, electric vehicles, IoT, and energy efficiency. These factors are enhancing Japan’s semiconductor industry, driving innovation and business expansion. Japan’s position as a pioneer in the global ASIC chip market continues to strengthen, as more industries demand specialized chips, with sustained growth expected in the coming years.
Application-Specific Integrated Circuit Market in Japan Driver and Challenges
Japan’s application-specific integrated circuit (ASIC) market is affected by various technological, economic, and legal factors. The increasing use of AI, 5G, and electric vehicles (EVs) technology is creating a need for more efficient and sophisticated chips. However, with all the opportunities come challenges such as intense global competition, supply chain constraints, and regulatory issues. Japan’s semiconductor industry must understand these challenges to build an agile growth strategy in the changing marketplace.
The factors responsible for driving the application-specific integrated circuit market in Japan include:
• Evolution of AI and 5G Technologies: As mentioned, AI and 5G represent the frontier of cutting-edge technology and innovation, serving as significant drivers of the CMOS ASIC market in Japan. AI applications require specific hardware for efficient machine learning and data processing, driving the demand for AI-enabled CMOS ASICs. Similarly, the rollout of 5G technology creates a need for special-purpose chips that can facilitate high-speed, low-latency communications. Japan’s investment in these technologies has created a solid base for the development of AI and 5G-focused ASICs that Japan will inevitably need in the future.
• Expansion of Electric Vehicles (EVs): The global transition toward greener vehicles, namely electric vehicles, has increased the demand for specialized automotive ASICs in Japan. These chips are key components for power management, energy efficiency optimization, and support of optimal autonomous driving systems. Being one of the major players in automotive manufacturing, Japan is in a strong position to take advantage of this market by designing and producing advanced CMOS ASIC chips specifically designed for electric cars and autonomous vehicles. With the rapid growth in EVs, the automotive semiconductor market in Japan is likely to experience gradual growth in demand for automotive ASICs.
• Growth of IoT Devices and Smart Cities: The increasing innovation in IoT devices and smart city development continues to be an important driver for the growth of the ASIC market in Japan. These applications require energy-efficient chips proficient in performing data-intensive tasks. Japan’s focus on digital transformation and infrastructure modernization has accelerated the adoption of IoT in industries such as healthcare, transport, and energy. The increasing need for smart connectivity is directly impacting the demand for IoT devices and smart city infrastructure, which in turn drives the need for IoT-optimized ASICs.
• Environmental Impacts and Sustainability Efforts: Energy-efficient ASICs have become crucial in the digital age, as industries and governments seek to minimize their carbon footprint. Japan’s goal to incorporate green technologies and promote sustainability has increased the demand for energy-saving chips in multiple sectors such as data centers, automotive, and IoT. Semiconductor firms are responding by designing high-performance ASICs that strategically reduce power consumption. With energy efficiency becoming a key focus globally, the Japanese market for energy-saving ASICs is predicted to grow rapidly.
• Government Financing in the Development of Semiconductors in Japan: Japan’s government initiatives greatly support the growth of the ASIC market. Efforts to boost domestic semiconductor production, increase per capita R&D expenditure, and improve collaboration within the industry are helping Japan build its semiconductor ecosystem. These activities advance Japan’s position in the global semiconductor market as a developed nation and contribute to the development of advanced ASICs.
Challenges in the application-specific integrated circuit market in Japan are:
• Global Supply Chain Disruptions: The challenges and risks posed by global supply chain disruptions, including those exacerbated by the COVID-19 pandemic and escalating geopolitical tensions, have greatly impacted the semiconductor supply chain. ASIC producers in Japan face difficulties in raw material and component procurement, which hinders timely production and increases costs. These complications make it more difficult for Japanese firms to address the growing demand for specialized AI, 5G, and automotive chips.
• Fierce Competition Worldwide: The ASIC industry is highly competitive, with nations such as the USA, South Korea, and China vying for a share of the market. Japan’s semiconductor companies must continuously innovate to develop advanced ASICs. Additionally, increasing international competition for research talent and funding further constrains Japan’s resources for continued growth in the ASIC market.
• Regulatory and Trade Difficulties: Japan’s ASIC market also faces regulatory and trade issues related to export controls and intellectual property rights. Global trade policy changes, including tariffs and restrictions on the export of semiconductor technologies, can significantly limit Japan’s competitiveness. Moreover, compliance with international standards can increase costs and delay the launch of new ASICs in the market.
Japan’s ASIC market is driven by technological innovations, increasing adoption of energy-efficient systems, and proactive government policies. However, the industry faces challenges such as supply chain disruptions, intense competition, and regulatory hurdles. Despite these challenges, Japan continues to expand its ASIC market, fueled by advancements in AI, 5G, EVs, IoT, and sustainability. Japan’s semiconductor sector is expected to remain a global leader in developing and manufacturing specialized integrated circuits.
List of Application-Specific Integrated Circuit Market in Japan Companies
Companies in the market compete on the basis of product quality offered. Major players in this market focus on expanding their manufacturing facilities, R&D investments, infrastructural development, and leverage integration opportunities across the value chain. Through these strategies, application-specific integrated circuit companies cater to increasing demand, ensure competitive effectiveness, develop innovative products & technologies, reduce production costs, and expand their customer base. Some of the application-specific integrated circuit companies profiled in this report include:
• Company 1
• Company 2
• Company 3
• Company 4
• Company 5
• Company 6
• Company 7
• Company 8
• Company 9
• Company 10
Application-Specific Integrated Circuit Market in Japan by Segment
The study includes a forecast for the application-specific integrated circuit market in Japan by product type and application.
Application-Specific Integrated Circuit Market in Japan by Product Type [Analysis by Value from 2019 to 2031]:
• Full Custom ASIC
• Semi-Custom ASIC
• Programmable ASIC
Application-Specific Integrated Circuit Market in Japan by Application [Analysis by Value from 2019 to 2031]:
• Telecommunication
• Industrial
• Automotive
• Consumer Electronics
• Others
Features of the Application-Specific Integrated Circuit Market in Japan
Market Size Estimates: Application-specific integrated circuit in Japan market size estimation in terms of value ($B).
Trend and Forecast Analysis: Market trends and forecasts by various segments.
Segmentation Analysis: Application-specific integrated circuit in Japan market size by product type and application in terms of value ($B).
Growth Opportunities: Analysis of growth opportunities in different product type and application for the application-specific integrated circuit in Japan.
Strategic Analysis: This includes M&A, new product development, and competitive landscape of the application-specific integrated circuit in Japan.
Analysis of competitive intensity of the industry based on Porter’s Five Forces model.
If you are looking to expand your business in this or adjacent markets, then contact us. We have done hundreds of strategic consulting projects in market entry, opportunity screening, due diligence, supply chain analysis, M & A, and more.
FAQ
Q1. What are the major drivers influencing the growth of the application-specific integrated circuit market in Japan?
Answer: The major drivers for this market are the rising need for specialized and high-capacity chips and the widespread integration of artificial intelligence and machine learning among industries.
Q2. What are the major segments for application-specific integrated circuit market in Japan?
Answer: The future of the application-specific integrated circuit market in Japan looks promising with opportunities in the telecommunication, industrial, automotive, and consumer electronic markets.
Q3. Which application-specific integrated circuit market segment in Japan will be the largest in future?
Answer: Lucintel forecasts that, within the product type category, semi-custom will remain the largest segment over the forecast period due to it’s lower complexity and broad range of applications.
Q4. Do we receive customization in this report?
Answer: Yes, Lucintel provides 10% customization without any additional cost.
This report answers following 10 key questions:
Q.1. What are some of the most promising, high-growth opportunities for the application-specific integrated circuit market in Japan by product type (full custom ASIC, semi-custom ASIC, and programmable ASIC), and application (telecommunication, industrial, automotive, consumer electronics, and others)?
Q.2. Which segments will grow at a faster pace and why?
Q.3. What are the key factors affecting market dynamics? What are the key challenges and business risks in this market?
Q.4. What are the business risks and competitive threats in this market?
Q.5. What are the emerging trends in this market and the reasons behind them?
Q.6. What are some of the changing demands of customers in the market?
Q.7. What are the new developments in the market? Which companies are leading these developments?
Q.8. Who are the major players in this market? What strategic initiatives are key players pursuing for business growth?
Q.9. What are some of the competing products in this market and how big of a threat do they pose for loss of market share by material or product substitution?
Q.10. What M&A activity has occurred in the last 5 years and what has its impact been on the industry?
For any questions related to Application-Specific Integrated Circuit Market in Japan, Application-Specific Integrated Circuit Market in Japan Size, Application-Specific Integrated Circuit Market in Japan Growth, Application-Specific Integrated Circuit Market in Japan Analysis, Application-Specific Integrated Circuit Market in Japan Report, Application-Specific Integrated Circuit Market in Japan Share, Application-Specific Integrated Circuit Market in Japan Trends, Application-Specific Integrated Circuit Market in Japan Forecast, Application-Specific Integrated Circuit Companies, write Lucintel analyst at email: helpdesk@lucintel.com. We will be glad to get back to you soon.