System-on-Module (SoM) Market Poised for Robust Growth Through 2031, Fueled by Edge AI, IoT, and Modular Innovation

November 24, 2025 — According to The Insight Partners; The global system-on-module (SoM) market is on a strong upward trajectory, driven by surging demand for compact, energy-efficient, and high-performance embedded computing solutions across industrial, healthcare, automotive, and IoT sectors. As companies increasingly pivot to modular architectures, the SoM market is expected to capture a significant share of the embedded systems space by 2031.

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Market Overview

A system-on-module (SoM) integrates processor cores, memory, and communication interfaces on a single board, providing a plug-and-play building block for embedded systems. This modular design streamlines development, reduces time to market, and boosts scalability — a value proposition that is resonating strongly across industries.

Analysts attribute the current surge in the SoM market to several converging trends: the rise of edge computing, integration of AI accelerators, growth in Industrial IoT, deployment of 5G connectivity, and mounting demand for secure and modular embedded platforms.

Key Market Drivers

• Edge AI adoption: As more devices perform inference at the edge, SoMs with onboard NPUs and neural accelerators are gaining traction.
• IoT proliferation: The explosion of connected devices in smart factories, medical systems, and consumer electronics is boosting demand for compact embedded modules.
• 5G and connectivity: Integration of 5G functionalities into modular systems enables low-latency and high-throughput communication.
• Customization & security: Designers prefer SoMs that offer configurability, power efficiency, and strong security, including support for RISC-V and advanced hardware bug mitigation.

Market Snapshot: By 2031 (Forecast Highlights)

• Market size & growth: Expected to expand from its current base to reach around US$ 4713.86 million by 2031, according to recent estimates.
• Compound Annual Growth Rate (CAGR): Forecast to grow at a high rate, driven by accelerating adoption of edge AI, modular hardware, and industrial automation.
• Segment dominance: ARM-based SoMs are projected to maintain leadership due to their power efficiency and versatility.
• Application leadership: The industrial automation segment will continue to be a key driver, propelled by smart factory deployments and robotics.

Global and Regional Analysis

• Asia-Pacific: Expected to lead the global SoM market, thanks to its manufacturing strength, rapidly growing IoT deployments, and strong electronics infrastructure.
• North America: Maintains a strong share, driven by advanced automation, healthcare systems, and defense segment adoption.
• Europe: Growth is supported by Industry 4.0 initiatives, automotive modular platforms, and stringent regulatory standards for embedded systems.
• Emerging regions: Latin America, the Middle East, and Africa are gradually accelerating their adoption of modular SoMs, particularly in connectivity and industrial applications, though from a lower base.

Market Trends and Analysis

• AI at the Edge: SoMs with integrated NPUs and machine-learning capabilities are increasingly common, as edge applications demand high compute near the data source.
• Open Architecture Momentum: There's a growing shift toward open-hardware architectures like RISC-V, which offer customization, security, and cost advantages.
• Advanced Standards: Modular standards such as COM-HPC, SMARC, Qseven, and COM Express are driving design flexibility.
• Energy Efficiency: Low-power SoMs are increasingly optimized for embedded and battery-powered applications.
• Security Focus: Enhanced hardware-level security, long-term support, and ruggedization are becoming key differentiators.
• Trade & Supply Chain Dynamics: Geopolitical tensions and tariff shifts are influencing the pricing and availability of SoM components.

Major Players and Competitive Landscape

Leading firms shaping the SoM market include Congatec, Advantech, AAEON, SECO, ADLINK, Avnet, Technexion, SolidRun, Emtrion, and Kontron. These companies are competing on innovation — launching modules with improved neural processing, better thermal profiles, longer lifecycle support, and adherence to emerging standards.

Updated Market News & Developments

• Recent reports suggest the SoM market is being strongly influenced by AI integration and edge computing.
• Manufacturers are launching customizable SoMs with advanced security and energy-efficient designs.
• Despite some headwinds from global trade tensions, demand remains buoyant across industrial robotics, smart devices, and 5G-connected systems.

Future Outlook & Forecast (to 2031)

• Continued rise of edge-first architectures: SoMs with AI capabilities and optimized compute will dominate embedded designs.
• Miniaturization will accelerate: Smaller, more efficient modules will drive innovation in wearables, drones, and portable medical devices.
• Open-hardware adoption: RISC-V and open standards will become increasingly mainstream as companies seek flexibility and cost advantage.
• Sustainability: Power-efficient SoMs will be increasingly favored in energy-constrained or battery-powered devices.
• Security & lifecycle support: With longer deployment cycles, customers will demand better firmware support, ruggedness, and hardware-level security.

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