Discover the Top 10 Electronics Manufacturing Trends & Innovations [2026]

Executive Summary: What are the Top 10 Electronics Manufacturing Trends in 2026?

1. 3D-Printed Electronics: The market is projected to reach USD 5.53 billion by 2034 at over 26% compound annual growth rate (CAGR), with Asia Pacific leading at 38%. However, conductivity issues and slower printing speeds hinder mass production.
2. Wide-Band-Gap Power Devices: These devices makeup over 16% of the power device market and will exceed 32% by 2029. Silicon carbide (SiC) devices alone are projected to generate USD 10 billion in revenue, while GaN devices will grow at a 41% CAGR.
3. Automated Manufacturing: Global investments in 300 mm fab automation will hit USD 400 billion by 2027. Companies like Samsung and Rapidus lead efforts with 1.4 nm and 2 nm production nodes.
4. Cybersecurity: In Q1 2025, manufacturers reported 39 ransomware incidents. Adoption of frameworks like the National Institute of Standards and Technology (NIST) and the International Electrotechnical Commission (IEC) 62443 is rising, alongside SASE rollouts and AI-based detection.
5. 5G & Edge Computing: The 5G PCB market will reach USD 10.5 billion by 2033 with a 15.4% CAGR. Ford and Analog Devices use private 5G networks for real-time production data and predictive analytics.
6. Digital Twins & Predictive Maintenance: Digital twins and predictive tools reduce surface-mount technology (SMT) energy use by up to 29.5%. Challenges remain in integrating legacy systems and managing fast-moving sensor data.
7. Circular Economy: Only 17% of global e-waste is formally recycled, which leads to USD 57 billion in material losses annually. Circular strategies reduce CO2 emissions by 10% and costs by 12% by 2035.
8. Embedded AI: The market will exceed USD 23.34 billion by 2030, with AI chips enabling complex edge tasks in compact devices. More than USD 2 billion was raised by 75 startups in Q1 alone.
9. Advanced Packaging & Chiplets: The market size will reach USD 148 billion by 2028 with a CAGR of 86.7%. The flip chip packaging market size is projected to reach USD 73.5 billion by 2035.
10. Tackling Chip Shortages and Trade Wars: Global chip demand will rise 29% by 2026, but shortages in mature-node ICs persist due to underinvestment. Trade tariffs could shrink the semiconductor market by up to 34%.

Read on to explore each trend in depth – uncover key drivers, current market stats, cutting-edge innovations, electronics manufacturing trends, and leading innovators shaping the future.

Frequently Asked Questions

1. What is the future for electronics?

Electronics manufacturing is moving toward smarter, greener factories using modular lines, AI-driven automation, and nearshoring.

2. What are the next-generation materials for advanced electronics?

2D materials like graphene, transition metal dichalcogenides (TMDCs), and ultrawide bandgap (UWBG) materials such as gallium nitride (GaN), gallium oxide (Ga2O3), aluminum gallium nitride (AlGaN), and diamond.

3. What are the challenges of emerging trends in electronic manufacturing?

A few of the challenges include extreme miniaturization, supply chain risks, high material costs, complex regulations, and the need for sustainable, low-energy production.

Methodology: How We Created the Electronics Manufacturing Trend Report

For our trend reports, we leverage our proprietary StartUs Insights Discovery Platform, covering 7M+ global startups, 20K technologies & trends, plus 150M+ patents, news articles, and market reports.

Creating a report involves approximately 40 hours of analysis. We evaluate our own startup data and complement these insights with external research, including industry reports, news articles, and market analyses. This process enables us to identify the most impactful and innovative electronics manufacturing industry trends.

For each trend, we select two exemplary startups that meet the following criteria:

• Relevance: Their product, technology, or solution aligns with the trend.
• Founding Year: Established between 2020 and 2025.
• Company Size: A maximum of 200 employees.
• Location: Specific geographic considerations.

This approach ensures our reports provide reliable, actionable insights into the electronics manufacturing innovation ecosystem while highlighting startups driving technological advancements in the industry.

Innovation Map outlines the Top 10 Electronics Manufacturing Trends & 20 Promising Startups

For this in-depth research on the Top Electronics Manufacturing Trends & Startups, we analyzed a sample of 1200+ global startups & scaleups. The Electronics Manufacturing Innovation Map created from this data-driven research helps you improve strategic decision-making by giving you a comprehensive overview of the electronics manufacturing industry trends & startups that impact your company.

Tree Map reveals the Impact of the Top 10 Electronics Manufacturing Trends

Based on the Electronics Manufacturing Innovation Map, the Tree Map below illustrates the impact of the Top 10 Electronics Manufacturing Trends. 3D-printed electronics improve prototyping with multi-material tools, though challenges in conductivity and scaling remain. Wide-band-gap semiconductors increase efficiency, that are enabled by new films and thermal tech.

AI-driven automation, no-code system-on-chip (SoC) tools, and smart inspection improve speed. Cybersecurity rises in priority with quantum encryption and AI-based monitoring. 5G and edge chips power real-time factory data, while digital twins and predictive maintenance reduce downtime and energy use. Circular practices like recyclable printed circuit boards (PCBs) and rare earth recovery reduce waste.

Embedded AI enables real-time, on-device decisions. Advanced packaging and chiplets enhance integration and bandwidth. Amid trade wars and chip shortages, digital supply tools ensure traceability, resilience, and production continuity.

Global Startup Heat Map covers 1200+ Electronics Manufacturing Startups & Scaleups

The Global Startup Heat Map showcases the distribution of 1200+ electronics manufacturing exemplary startups and scaleups analyzed using the StartUs Insights Discovery Platform. It highlights high startup activity in the USA and India, followed by the UK. From these, 20 promising startups are featured below, selected based on factors like founding year, location, and funding.

Want to Explore Electronics Manufacturing Innovations & Trends?

Top 10 Emerging Electronics Manufacturing Trends [2026]

1. 3D-Printed Electronics: Market to Hit USD 5.53 B by 2034 at 26% CAGR

3D-printed antennas, circuit boards, sensors, and microelectromechanical systems support advances in automotive, healthcare, aerospace, and IoT sectors.

Credit: Claight Corp

The global market for 3D printed electronics is expected to reach USD 5.53 billion in 2034, with a CAGR of over 26%. Asia Pacific, especially India, shows fast growth with its CAGR expected to exceed 38%. Moreover, in the last five years, over USD 500 million in venture capital went into startups and experts working on new printers, materials, and design software.

At the same time, several technical and practical challenges still limit the wider use of electronics manufacturing. One major issue involves the difference in speed between making prototypes and producing at scale. Most 3D-printed systems run slower than standard high-speed printed circuit board (PCB) machines. It lowers their use for large-scale, high-volume manufacturing.

Engineers also continue to face problems with materials. The printed conductive inks, including those using silver nanoparticles, show 30-60% less conductivity than copper traces used in regular PCBs. This reduces their use in high-power and high-frequency settings. In addition, printed electronics need careful process control to avoid reliability issues. Without tight control, failure rates go up 2-3 times compared to traditional methods.

To solve these issues, equipment maker Nano Dimension built the DragonFly printer system that allows multi-material printing with automatic part placement. The Manufacturing Technology Centre (MTC) in the UK also put major funding into laser-based methods. These methods deposit conductive tracks directly onto complex 3D-printed surfaces to improve conductivity and reliability in embedded IoT and sensor use cases.

Further, current research efforts focus on using print heads with multiple nozzles to increase speed and developing copper-based inks to lower costs. They also add real-time defect checks with optical tools to raise production quality above 95%.

Also, high-frequency dielectric materials with low loss tangents reduce signal loss by over 20% in radio frequency (RF) applications such as 5G antennas and satellite communication systems.

MAASS builds a Multi-Material SLA Printer

US-based startup MAASS builds SHIMMY, which is a multi-material 3D printer. It uses a high-resolution stereolithography apparatus (SLA) equipped with twin resin vats. The printer also features a 405 nm digital light processing (DLP) projector and a silicone wiper for layering materials.

Its features also include heated and ultrasonic vats, an air knife for rapid drying, and a pump with ultraviolet (UV) filtering to manage waste resin. All components are enclosed in a sealed structure that limits fumes and reduces noise.

SHIMMY operates through a browser-based interface that requires only an Ethernet-connected computer and a ventilation outlet. It prints with virtually any resin, like metallic, ceramic, or high-viscosity, for complex 2D and 3D circuit boards with trace widths as fine as 40 microns. Thus, the printer supports rapid prototyping, multi-material functionality, and dense circuit integration.

Syenta enables High Speed Metallization

Australian startup Syenta develops Achyon, a localized electrochemical manufacturing (LEM) equipment. It enables high-speed metallization for semiconductor packaging. The equipment directly patterns and deposits metal in a single step.

Achyon addresses both high-density and low-density regions to enhance bump height uniformity and coplanarity across substrates. It further supports thinner seed layers for finer redistribution layer (RDL) resolution below 1 µm while minimizing voltage drop and material loss.

2. Wide-Band-Gap Power Devices: SiC Revenue to Reach USD 10 B by 2029

Wide-band-gap (WBG) power devices, mainly made from silicon carbide (SiC) and gallium nitride (GaN), improve energy efficiency, shrink system sizes, and strengthen operational performance. Currently, wide bandgap technologies make up over 16% of the global power device market. This share is expected to rise to more than 32% by 2029.

Worldwide, over USD 30 billion has been committed to SiC, with most of the investment focused on device manufacturing. By 2029, SiC device revenue is expected to reach nearly USD 10 billion with a CAGR of 24%. Over the same period, GaN revenue will grow to USD 2 billion with a compounded growth of 41% annually.

A few major projects that contributed to this growth include Bosch’s USD 1.5 billion, and Coherent’s USD 1 billion plan. Additionally, JCET Group plans to double its back-end production for WBG power devices. The company uses advanced packaging techniques like Kelvin source structures and Flip Chip technology to reduce unwanted resistance and inductance.

Some challenges faced by the sector include high production costs, changing material quality, lack of standard processes, and supply chain delays. To overcome these hurdles and support wider adoption, companies are advancing design and packaging innovations.

Keysight works at the forefront of circuit design and spreads WBG use by building better layouts and thermal solutions. These reduce problems like heat, electromagnetic interference (EMI), and circuit layout issues, which often grow more challenging with the faster switching speeds and high power density. At the same time, JCET Group‘s use of top-side cooling and ribbon bonding improves how heat moves through devices.

Gaianixx advances Epitaxial Thin-Film Technology

Japanese startup Gaianixx develops single-crystal thin films for semiconductor applications using its proprietary Material, Machine, Method, Members (M4) epitaxial interlayer and lattice matching technologies.

The startup grows monocrystalline layers by placing an interlayer between the substrate and the functional film. This interlayer assists in matching the lattice structures and reduces stress between layers.

Further, it uses twinned martensitic transformations to adjust for stress across multiple layers. This ensures the crystal remains uniform, even when using imperfect substrates. Moreover, the method also achieves stable piezoelectric properties at high temperatures and maintains polarization immediately after deposition.

In parallel, the startup integrates dual-frequency inductively coupled plasma (ICP) technology to improve deposition precision. It also uses AI to monitor and adjust deposition parameters in real time for 8-inch wafer production.

Further, the startup enables the production of compact, high-performance, and energy-efficient semiconductor devices. These include micro-electro-mechanical systems (MEMS), power devices, and LEDs, through high-yield thin film growth solutions.

CoolSem Technologies provides III-V Thermal Management

Dutch startup CoolSem Technologies offers thin-film thermal management solutions that improve the performance of III-V photonics, radio frequency (RF), and power electronics devices.

It removes the III-V substrate that allows the thin-film device to attach directly to a heat sink or spreading layer. This improves heat flow and reduces internal temperature buildup.

Moreover, these thin-film thermal management solutions increase device efficiency. They allow to reuse of materials like gallium arsenide (GaAs) and indium phosphide (InP). Further, the solutions enable heat control for high-performance components used in telecom, sensing, space, and consumer electronics.

3. Automated Manufacturing: Fab Equipment Spend to Reach USD 400 B by 2027

Semiconductor manufacturers apply automation to increase efficiency and resilience. Investments in 300 mm fab equipment for automation are expected to reach USD 400 billion by 2027.

Credit: SEMI

Semiconductor maker Samsung plans to start mass production of 1.4 nm process technology in 2027 to increase transistor performance and integration. In the same year, Japanese chipmaker Rapidus will also begin using single-wafer processing for 2 nm chips. It enables close, AI-supported control over each processing step to improve yield and reduce defects.

Even with this progress, the electronics manufacturing sector faces major hurdles. Trade tensions, high capital costs, talent shortages, and the need to connect older systems with modern automation and AI create real barriers. Building automated factories requires large upfront spending and calls for retraining workers to run and manage new systems.

Outdated manufacturing execution systems (MES) and gaps in digital connections also slow down production. These issues, especially beyond the SMT (surface mount technology) line, limit the benefits of full Industry 4.0 integration.

Industry leaders work through these challenges by using AI-based MES platforms that manage robotic systems, handle materials and logistics, and create real-time digital versions of factory operations.

Moreover, AI-driven visual inspection and process control systems use high-resolution cameras, advanced lighting, and sensors. Custom AI algorithms then analyze the data to detect tiny defects in real time. Accuracy rates now reach up to 97% to reduce waste, prevent delays, and ensure quality in products like circuit boards and chips.

Beyond inspection, AI assists in running entire processes by predicting equipment issues and adjusting production steps. It makes real-time decisions to maintain quality, optimize throughput, and prevent failures.

Smart factories further support this with connected sensors, edge computing, and cloud platforms. These technologies allow remote teams to monitor and control production through digital twins. The upgrades reduce downtime, improve quality, and remove the need for on-site troubleshooting.

Photonium automates Optical Inspection for Semiconductor Manufacturing

US-based startup Photonium makes an AI-powered optical system design software that automates optical inspection and lithography systems for semiconductor manufacturing. It combines optical component placement, real-time computer-aided design (CAD) modeling, and automatic bill of materials generation into a single drag-and-drop interface.

Credit: Photonium

The software auto-generates mechanical structures to hold optics in place while following design rules for clearance and stability. It updates simulations, computer-aided design (CAD) assemblies, and sourcing details automatically as designs evolve.

Moreover, the startup offers access to a built-in component library and includes AI-driven suggestions based on performance, price, and availability.

ITDA offers a No-code SoC Design

South Korean startup ITDA builds no-code generative system intellectual property (IP) solutions that simplify and increase system-on-chip (SoC) system design. The solutions include Power Canvas, Clock Canvas, and DFT Canvas.

Power Canvas generates SoC-level power architecture. It enables system-wide power optimization using built-in design-for-test support and leakage power reduction techniques.

Further, Clock Canvas handles clock system design. It offers integrated design for testability (DFT) functionality and power reduction strategies to streamline timing architecture setup.

DFT Canvas supports the development of DFT and input/output (IO) subsystems to provide flexible DFT networks and configurable IO options for testability.

All three tools generate register-transfer level (RTL) code automatically and integrate with existing electronic design automation (EDA) workflows. They further support standard outputs like unified power format (UPF) and synopsys design constraints (SDC).

4. Cybersecurity: 39 Ransomware Attacks Reported in Q1 2025

The electronics manufacturing sector reported about 39 incidents of ransomware activity in Q1 of 2025. More use of industrial Internet of Things (IIoT), AI-driven controllers, and real-time data sharing expanded the number of possible attack points. Electronics manufacturers face high risk due to their operational technology (OT) setups. These systems often rely on older infrastructure that is not built to handle today’s cybersecurity threats.

However, new government rules in the US and Europe push the adoption of standards like the NIST Cybersecurity Framework and IEC 62443 for factory automation. Testing centers include cybersecurity checks alongside electrical safety tests and digital twin simulations to ensure both compliance and stronger system protection.

Also, electronics manufacturing companies invest in secure access service edge (SASE) solutions to manage cybersecurity across multiple production sites under one system. Additionally, they apply network segmentation to limit the spread of cyberattacks and use machine learning (ML) to detect unusual device behavior early in the process.

For example, Milwaukee Electronics rolled out a global SASE setup, which led to fewer network outages and quicker incident response. It also achieved full regulatory compliance without slowing down operations.

Further, electronics manufacturers use digital twins and secure-by-design methods before launching new devices. Companies such as Foxconn, Flex, and Jabil use AI-based optical inspection and behavior analytics to detect problems quickly and support predictive maintenance.

Soon, tools like quantum-resistant encryption and autonomous security operations center (SOC) systems will combine AI and human expertise to combat cyber threats.

Caspia Technologies provides AI-Powered Chip Security Solutions

US-based startup Caspia Technologies offers AI-powered security verification solutions that protect SoC designs from cyberattacks. Its platform works with existing design workflows to detect hardware vulnerabilities early.

It uses tools that perform automated static linting based on security databases such as common vulnerabilities and exposures (CVE), common weakness enumeration (CWE), and trust-hub.

Credit: Caspia Technologies

Moreover, the platform uses generative AI and multiple AI agents to analyze register transfer level (RTL) code. These tools generate targeted security tests and identify potential flaws before production begins.

Caspia Technologies also supports hardware lifecycle protection with solutions for intellectual property (IP) safeguarding, side-channel analysis, counterfeit detection, and PCB assurance across the supply chain.

KEEQuant offers Quantum Key Distribution

German startup KEEQuant develops Andariel, which is a quantum key distribution (QKD) system. It also has KMS1, which is a key management system (KMS). The startup leverages photonic integrated circuits (PICs) to apply QKD functionality onto a single chip to reduce size, power consumption, and cost.

Andariel uses continuous-variable OKD to generate cryptographic key pairs within optical fiber networks. Similarly, the startup’s KMS1 platform manages key lifecycles and distributes keys securely across complex network topologies to ensure controlled and reliable encryption processes.

5. 5G & Edge Computing: PCB Market for 5G to Hit USD 10.5 B by 2033

5G and edge computing technologies offer features like ultra-reliable low-latency communication, large-scale device connections, and real-time analytics. These developments indicate how factories view, manage, and automate their operations.

Analog Devices uses 5G’s high bandwidth and low latency to enable real-time communication between sensors and machines on the production floor. This setup reduces errors and improves production speed.

Ford’s Rouge complex in Michigan combined edge computing with a private 5G network to collect live data from sensors. It improved inventory tracking and equipment uptime, and made large-scale automation more efficient.

Also, EdgeQ builds chips that assist factories in running private 5G networks for powering wireless robots and machine learning tools.

For PCBs and embedded systems, 5G and edge computing bring major changes. The PCB market for 5G is expected to grow to USD 10.5 billion by 2033, with a growth rate of 15.4% per year from 2026. This growth comes from new high-frequency designs and innovations like flexible, durable, and eco-friendly PCBs that support fast, low-latency communication needed for 5G and edge devices.

Credit: Grand View Research

Further, the embedded systems market is expected to reach USD 169.1 billion by 2030. These systems include AI-powered microcontrollers and edge accelerators that process data directly at the edge of the network.

However, manufacturers face issues such as labor shortages, unpredictable supply chains, and quickly outdated components. Adding to the challenge are needs like quality assurance, faster prototyping, and dealing with varied, small production runs.

To solve these challenges, electronics manufacturers use predictive analytics, digital twins to accelerate design and testing, and modular designs. They also deploy manufacturing execution systems (MES) to track production data and control processes in real time.

Neuromorphica makes Neuromorphic SoC Platforms

Bulgarian startup Neuromorphica builds NMS731 and NMT194, neuromorphic system-on-chip (SoC) platforms. The NMS731 chip integrates a spiking neural network core, a reduced instruction set computer-five (RISC-V) processor, and a software-defined radio (SDR) module.

This combination enables real-time AI inference directly on-device without cloud reliance. It processes inputs from integrated sensors such as vision, audio, and motion while maintaining latency below 5 milliseconds. Moreover, it offers better security through cryptographic and blockchain accelerators.

Alongside, Neuromorphica offers the NMT194 platform, which focuses on flexible wireless communication and traditional signal processing. NMT194 features a digital signal processor (DSP), a RISC-V core, and the same SDR architecture to support software-defined upgrades in IoT field devices.

Both platforms emphasize low power consumption, secure data handling, and ultra-fast processing for edge computing in electronics manufacturing.

United Micro Technology builds 5G IoT Chips

Chinese startup United Micro Technology offers enhanced mobile broadband (eMBB) and reduced capability (RedCap) wireless SoC solutions.

eMBB, based on the 3rd generation partnership project (3GPP) Release 17 standard, supports high-speed data transfer. It is used for large-bandwidth applications such as industrial IoT, smart gateways, connected vehicles, and consumer devices.

In parallel, the startup provides a RedCap chip that integrates 5G network slicing, local area network (LAN) support, and time-sensitive communication features. It finds applications in low-power use cases like wearables, industrial video systems, and smart logistics.

Additionally, the startup offers a narrowband communication chip built on the 3GPP Release 13 standard. The chip supports machine-to-machine (M2M) connections with low throughput, low latency, and ultra-low power consumption. It is applicable for intelligent sensing, wearable health monitors, and embedded M2M devices.

6. Digital Twins & Predictive Maintenance: 29.5% Energy Savings Per SMT Line

The electronics manufacturing sector, which remains highly sensitive to downtime costs, uses digital twins and predictive maintenance to improve efficiency. For instance, Siemens leverages AI-powered predictive maintenance to check equipment health, connect asset data with MES. Delta Electronics‘ digital twin-powered automation improves agility, better use of resources, and more precise manufacturing in semiconductor plants.

Industrial automation and Industry 4.0 sped up the use of predictive maintenance in semiconductor fabrication plants. Tools like vibration analysis and thermal imaging spot issues in wafer equipment before failure. This reduces downtime and expenses.

Credit: Verified Market Reports

Moreover, the semiconductor manufacturing predictive maintenance market size is projected to estimated to reach USD 12.9 billion by 2033. It will grow at a CAGR of 15.6% from 2026 to 2033.

However, electronics manufacturers face challenges such as handling large amounts of sensor data, connecting new systems with older ones, and managing high capital expenses. Fast-moving data, especially from surface mount technology (SMT) and semiconductor lines, overwhelms analytics platforms unless data is filtered and sorted properly.

Moreover, older enterprise resource planning (ERP) and shop-floor systems often require extra software or step-by-step updates since replacing them all at once interrupts production.

Companies tackle these problems by starting with test runs on key machines and investing in accurate sensors. They also use edge computing alongside cloud tools to reduce delays and improve system stability.

For instance, TMA Solutions integrated hybrid digital twin models in PCB and electronics factories to improve energy efficiency. By combining circuit simulation with real-time process data, they reduced energy use by 29.5% and saved over 13 600 kWh per year on each SMT line.

Banyan.eco develops a Sustainable Electronics Design Platform

French startup Banyan.eco builds a sustainable electronics design platform that measures, predicts, and reduces the environmental impact of electronics using AI agents.

The platform analyzes Gerber files and bills of materials and collects verified supplier data. It then runs full lifecycle simulations to produce product carbon footprint (PCF) reports.

Further, the platform provides actionable eco-design recommendations, a decarbonization dashboard, and regulatory-compliant supply-chain traceability. This supports digital product passports and continuous updates as new data arrives.

Scratchboard.io creates a Circuit Simulation Platform

UK-based startup Scratchboard.io offers a cloud-native circuit and embedded-systems simulation platform. It runs real-time electrical modeling in the browser and supports AVR microcontroller code upload with step debugging. Also, it saves projects across devices for instant iteration before any hardware build.

Further, the platform combines a component library with custom part creation to offer an embed widget for live, interactive designs on web pages. Users test designs risk-free with zero hardware cost and draw on 100K+ circuits created.

They also use simulation to catch errors early and validate firmware and hardware interactions. Thus, the startup reduces prototyping spend and rework, shortens development cycles, and strengthens design quality across electronics programs.

7. Circular Economy: Circular Strategies to Reduce Cost by 12%

Circular economy integration in electronics manufacturing speeds up as companies address raw material shortages, regulatory requirements, and growing e-waste problems. Adopting circular strategies such as remanufacturing, using circular material inputs, and product-as-a-service models reduces costs by an average of 12%. Also, it is expected to reduce carbon dioxide equivalent (CO2e) emissions by 10% by 2035 compared to business-as-usual practices.

Further, the electronics sector generates greenhouse gas emissions due to high raw material and energy needs, complex supply chains, and rapid product replacement cycles. Despite the high value of recoverable materials, only 17% of global e-waste was formally recycled in 2019. It led to the loss of over 44 million tonnes of raw materials worth USD 57 billion every year.

Circular business models also open new markets and reach price-sensitive customers, as remanufactured electronics often cost 30-40% less than new devices. Transitioning to these models requires major upfront changes and investment.

However, companies that gradually combine circular materials with service- or subscription-based offerings throughout a product’s lifecycle gain operational savings. They also reduce emissions more effectively over time.

For instance, Jiva Materials developed Soluboard, a biodegradable PCB material that supports full recovery of components at end-of-life. Similarly, Hard Blue Si-Carbons turns agricultural waste into recycled silicon carbide for semiconductor abrasives.

Further, semiconductor manufacturing faces strong pressure to grow without increasing resource extraction. The launch of the Circular Semiconductors Research Network by SEMI and imec in 2025 created a practical framework to rank materials for circularity. This initiative speeds up the purification, reuse, and resale of spent materials.

Circelec offers Recyclable Electronics Products

Swiss startup Circelec develops recyclable electronics products using biodegradable, low-carbon materials to reduce e-waste. The recycling process involves using degradable substrates and additive manufacturing to print recyclable metals and interconnects.

Thus, Circelec lowers material and chemical use, simplifies end-of-life recovery, and supports rapid prototyping with fewer process steps.

REEcover provides Rare Earth Elements Recycling

Swiss startup REEcover develops rare earth recovery and separation technology to extract and separate europium and yttrium from end-of-life energy-saving lamps. These materials are ready for reintegration into LEDs, displays, magnets, and other electronics supply chains.

It further reduces dependency on mined ores, lowers environmental impact, and supports sustainability and circularity targets.

8. Embedded AI: Market to Surpass USD 23.34 B by 2030

Embedded AI processes data, runs inference, and makes decisions locally on devices. It enables real-time responsiveness and independent operation at the edge. The market is expected to grow beyond USD 23.34 billion by 2030 at a CAGR of 14.10%.

Credit: Mordor Intelligence

New edge-AI chips and hardware accelerators play a central role in this change. Specialized silicon like neural processing units (NPUs), field-programmable gate arrays (FPGAs), and application-specific integrated circuits (ASICs) enhance embedded devices in electronics manufacturing.

These chips enable even small machines such as PCB assembly robots or x-ray component testers to perform complex AI tasks without relying on the cloud. Next-generation systems add self-learning features that allow machines to adapt calibration and detect anomalies as production conditions change.

However, using embedded AI in mass production presents challenges. Manufacturers face limited computing power in devices and energy constraints for battery-operated modules. They also encounter compatibility issues with older machinery and higher cybersecurity risks from increased connectivity.

The industry addresses these challenges through lightweight AI models, quantization, and model compression, along with frameworks like Lite RT and ONNX for efficient edge inference. Hardware developments, such as Tesla and Samsung‘s USD 16.5 billion partnership to produce 2 nm embedded AI chips, improve performance and strengthen supply chain reliability.

Investment in embedded AI startups showed momentum in 2025, with more than USD 2 billion raised by 75 startups in Q1 alone. AI chips and supporting optical communication technologies also saw strong investor interest. It raised over USD 400 million in the same quarter.

Axelera AI further secured EUR 61.6 million in government and EU grants to roll out its edge inference chiplets for smart manufacturing. Retym raised USD 75 million to build programmable coherent digital signal processing (DSP) solutions.

Periphery offers Embedded AI Threat Management

UK-based startup Periphery offers two products, Insights and Outpost. Insights evaluates a device’s software bill of materials (SBOM) to identify vulnerabilities in third-party components and performs agent-based assessments to detect misconfigurations or weak credentials.

Further, it runs penetration tests using data from honeypots and threat intelligence to validate resilience against real-world attacks.

Outpost works as a real-time threat monitoring solution for embedded devices through lightweight AI-powered agents. It tracks telemetry data, analyzes attack surfaces, and provides contextual threat alerts.

These solutions give manufacturers early visibility into supply chain risks and maintain operational integrity by preventing breaches before deployment and throughout a product’s lifecycle.

Embrya designs Resizable Low-footprint Chip IPs

French startup Embrya designs ENKI and ENKI Development System (ENKI-DS), which are AI and ML accelerators optimized for embedded electronics. They provide resizable low-footprint chip IPs and zero-code on-the-fly reconfiguration for artificial neural network inference.

The ENKI core-IP is built on a field-programmable gate array (FPGA). It integrates with application-specific integrated circuits (ASICs), central processing units (CPUs), GPUs, SoCs, and networks on chips (NoCs).

ENKI core-IP removes memory limitations and enhances process efficiency of high-performance applications. Thus, it supports federated learning architectures.

The ENKI-DS simplifies the integration of ENKI features and allows developers to embed and optimize AI capabilities across use cases such as deep space or IoT devices.

9. Advanced Packaging & Chiplets: Market to Reach USD 148 B by 2028

The advanced semiconductor packaging market is projected to reach USD 78.6 billion by 2028. Chiplet-based architectures will lead to a USD 148 billion market by 2028 at a CAGR of 86.7%.

Credit: MarketsandMarkets

Over the same period, the flip chip packaging market is expected to achieve USD 73.5 billion by 2035 while expanding high-density interconnects and enabling more complex heterogeneous integration.

On the investment front, SK hynix is building a USD 3.87 billion advanced chip packaging facility near Purdue University to bring high-bandwidth memory (HBM) manufacturing to the USA. Micron is investing USD 7 billion in a high bandwidth memory (HBM) packaging plant in Singapore to expand capacity by 2027 for AI-focused computing.

The industry faces technical and operational hurdles. Pushing monolithic system-on-chip (SoC) designs below the 2 nm node offers fewer performance and cost benefits due to the physical limits of lithography technology.

Moreover, the lack of universal chiplet interoperability standards slows integration across vendors. Advanced 2.5D and 3D stacking, along with wafer-level packaging, requires new metrology tools, precise bonding, and panel-level processes. These offer high yield at a lower cost.

To address these issues, companies are introducing new technologies. For instance, ASE‘s VIPack platform and Integrated Design Ecosystem (IDE) offer toolchain-driven efficiency gains of up to 50% over legacy workflows.

Lotus Microsystems builds Power Interposer

Danish startup Lotus Microsystems builds power interposer technology that enables compact power modules with better heat management and higher power density. The technology integrates thick-copper redistribution layers, double-sided wafer routing, and high-aspect ratio through-silicon vias.

These features distribute current and dissipate heat to improve thermal performance. They also allow closer placement of power converters to high-power loads like AI chips, graphics processing units (GPUs), and field-programmable gate arrays (FPGAs).

Moreover, Lotus Microsystems combines 2.5D and 3D packaging techniques with heterogeneous integration of complementary metal-oxide-semiconductor (CMOS), MEMS, GaN, and passive components. It enables high efficiency and reduction of derating in next-generation consumer electronics.

Hundred Semiconductors provides Chiplet Packaging Prototyping

Japanese startup Hundred Semiconductors offers semiconductor packaging and through-silicon via (TSV) manufacturing technology. It uses a half-inch wafer process by combining multi-chip bonding and low aspect ratio via structures.

The technology integrates copper/titanium (Cu/Ti) pad and redistribution layer connections to improve electrical contact and yield. Further, it supports flexible SoC and system-in-package (SiP) designs for smartphones, wearables, automotive electronics, and other connected devices.

10. Tackling Chip Shortage and Trade Wars: Semiconductor Market Could Shrink 34% by 2026

The demand for semiconductors is expected to rise by nearly 29% by the end of 2026. This growth comes from expanding applications in generative AI, IoT, and edge computing while outpacing current production forecasts for the semiconductor industry.

The supply of HBM also remains limited, with most of the 2026 production already allocated, which leads to long delivery times and ongoing price pressures. Trade wars are adding more instability to an already fragile supply network.

However, the biggest shortages remain in mature-node ICs above 40 nm, such as microcontrollers and analog chips that are essential for cars, industrial equipment, and many other products. Long-term underinvestment in these basic chips has made sourcing harder and more expensive. At the same time, most new funds flow toward nodes below 3 nm for high-performance computing.

Trade tensions, mainly between the USA and China, add another layer of difficulty. Tariffs as high as 145% on semiconductors, combined with Chinese tariffs of up to 125% on American tech and raw materials, raised the global production costs. If these policies continue, the global semiconductor market could shrink by as much as 34% by 2026.

Companies invest in new capacity. Annual 300mm fab equipment spending is projected to reach USD 136.2 billion in 2026 and USD 140.8 billion in 2027. China is leading the charge with over USD 100 billion in spending. South Korea and Taiwan are investing USD 81 billion and USD 75 billion, respectively, while focusing on memory and advanced logic technologies.

To deal with supply-demand gaps and geopolitical risks, electronics manufacturers adopt Supply Chain 4.0, using digital tools. For example, AI, real-time analytics, and digital twins predict inventory needs and assess risks in detail.

INspares creates an Obsolescence Management Software

German startup INspares builds OT360, a software that provides transparency and control over electronic components used in industrial manufacturing facilities.

The software digitally records each installed component, links it to a central database, and makes relevant information accessible via a QR code or through a secure online portal.

OT360 continuously monitors the operational status, availability, updates, and service life of safety-critical parts to identify risks and plan replacements before failures occur. It also manages obsolescence data and offers clear visibility into component life cycles and discontinuations to reduce downtime and production losses.

DIGITHO Technologies offers Secure Chip Traceability

Canadian startup DIGITHO Technologies develops reprogrammable photomasks and a microchip serialization system. It improves flexibility and traceability in semiconductor manufacturing.

The startup’s photomasks use reconfigurable pixels to adjust and print different patterns directly onto wafers without requiring new physical masks. This enables real-time design changes and fast prototyping and offers an alternative to maskless lithography.

Credit: DIGITHO Technologies

The photomasks integrate with standard lithography equipment and support direct writing of identifiers for the serialization and tracking of individual dies across the production cycle.

The startup’s features include on-the-fly pattern adjustments, cost-effective implementation for high-volume manufacturing, and better quality control through unit-level traceability.

Discover all Electronics Manufacturing Trends, Technologies & Startups

As electronics manufacturing accelerates, overlapping trends like embedded AI, quantum security, and chiplet packaging reshape the manufacturing and scaling of products. Among the others, technologies such as biodegradable PCBs, federated learning systems, AI-powered optical design software, and no-code SoC development are gaining ground.

At the same time, areas like bioelectronic interfaces, secure edge firmware updates, and neuromorphic computing will soon influence how devices are designed, protected, and deployed.

The electronics manufacturing trends & startups outlined in this report only scratch the surface of trends that we identified during our data-driven innovation & startup scouting process. Identifying new opportunities & emerging technologies to implement into your business goes a long way in gaining a competitive advantage.