LED Lighting Market Set for Recovery in 2025 Driven by Smart Solutions and Vertical Farming, Reports TrendForce

According to a latest report by TrendForce, the global LED lighting market faced headwinds in 2024, with overall industry revenue declining due to sluggish demand in key regions. However, niche segments such as smart lighting and LED plant lighting demonstrated resilience, signaling a transformative shift in the sector. The firm projects a cautious recovery in 2025, with the global LED lighting market rebounding to $56.626 billion, up from $56.058 billion in 2024, fueled by infrastructure upgrades, sustainability mandates, and technological innovation.  

 General Lighting Market: Challenges and Recovery  

In 2024, the general LED lighting market contracted by 4.2% year-over-year to $56.058 billion, pressured by high U.S. interest rates, weakened demand in China, Europe‘s geopolitical strains, and Japan‘s yen depreciation. Despite these challenges, Q4 2024 saw marginal improvement as LED adoption accelerated in retrofit projects.  

Looking ahead, TrendForce anticipates a 1% rebound in 2025, driven by:  

- Infrastructure Investments: Public projects in municipal, sports, and EV charging infrastructure boosting demand for outdoor lighting (e.g., LED streetlights, floodlights, and parking lot fixtures).  

-Renovation Demand: Replacement cycles for high-quality, health-focused, and smart-compatible LED products in existing buildings.  

-Risks: Intensified competition from global supply chain expansions and potential trade policy shifts targeting LED products.  

 Smart Lighting: Leading the Charge  

The smart lighting segment emerged as a bright spot in 2024, growing 17.6% globally. Growth was propelled by:  

-Commercial and Industrial Adoption: IoT-integrated systems for energy management in outdoor and industrial settings.  

-Residential Recovery: Declining costs and expanding product lines (e.g., smart bulbs, downlights, and LED strips) driving consumer demand.  

In 2025, smart home lighting is expected to rebound further, with innovations like tunable circadian rhythm systems gaining traction.  

 LED Plant Lighting: Vertical Farming Revitalizes Growth  

The LED plant lighting market grew 6.6% to $1.315 billion in 2024, marking a sustainable recovery beyond temporary restocking. Key drivers include:  

-High-Efficiency Upgrades: Adoption of fixtures with higher photosynthetic photon flux (PPF) and efficiency (PPE).  

-Vertical Farming Expansion: Renewed investments in Asia, the Middle East, and Europe for high-value crops (e.g., medicinal plants, berries).  

-Research Collaborations: Partnerships with agricultural institutions to optimize light recipes for diverse species.  

TrendForce forecasts accelerated growth in 2025 as vertical farms diversify crops and governments prioritize food security.  

 Long-Term Outlook: Cautious Optimism  

Beyond 2025, the LED lighting market is poised for steady expansion, reaching $63.903 billion by 2029 at a 2.7% CAGR. Growth will hinge on:  

-Sustainability Trends: Carbon reduction policies and energy-efficient retrofits in healthcare, smart manufacturing, and infrastructure.  

-Technological Integration: Advanced smart controls, human-centric designs, and IoT connectivity.  

- Geopolitical Risks: Trade barriers and supply chain disruptions remain critical variables.  

Industry Implications  

“The market is transitioning from volume-driven growth to value-driven innovation,” noted TrendForce analysts. “Companies must prioritize R&D in smart and niche applications to differentiate themselves in an increasingly competitive landscape.”  

For stakeholders, the report underscores opportunities in:  

- Outdoor and Architectural Lighting: Tied to smart city projects.  

- Health-Centric Designs: Tunable spectra for workplaces and homes.  

- Agricultural Technology: Customizable plant lighting solutions.  

As the LED industry navigates post-pandemic recovery, adaptability to regional policies and consumer trends will define winners in this $60+ billion arena.