Bluetooth IC Market Shifts Toward IoT as Edge AI and Positioning Gain Ground

Bluetooth IC Market Outlook: The Mix Shift from Audio to Data Bluetooth

The discrete Bluetooth IC market is large and mature, but its growth profile is changing. TSR forecasts shipments to rise from 8.3 billion units in 2025 to 10.3 billion units in 2032, a CAGR of 3.2%. Audio Bluetooth SoCs will remain the largest segment in 2025, with a 61% share. But the mix is gradually shifting toward Data Bluetooth. By 2031-2032, Data Bluetooth and Audio Bluetooth are expected to reach an almost 50:50 split as IoT-related use cases continue expanding.

Data Bluetooth ICs, including dual-mode data Bluetooth and BLE single-mode SoCs, are used in many IoT and connected devices, such as HID, asset tracking, Find My tags, healthcare devices, smart home products, automotive digital keys, and industrial IoT. Growth is expected to continue as Bluetooth adds functions such as Channel Sounding, High Data Throughput, and Ambient IoT support. These features will expand Bluetooth into positioning, access control, tracking, media streaming, and ultra-low-power sensing.

The dual-mode Audio Bluetooth IC market grew rapidly until around 2024, mainly driven by low-end Bluetooth audio devices. From 2025, however, shipments are expected to enter a mature phase and remain mostly flat over the long term. Near-term weakness in low-end smartphones, memory inflation pressures in emerging markets, and softer white-brand demand will weigh on entry-level audio devices. As a result, growth opportunities are shifting from unit expansion to higher-value mid-range and high-end products with high-res audio and edge AI.

Bluetooth 6 and Beyond: New Features Expanding IoT Use Cases

Bluetooth SIG continues to update the standard, with Bluetooth 6.x adding Channel Sounding, low-latency HID, and improvements in positioning and connectivity. While higher throughput, new 5/6 GHz operation, and LE Audio enhancements mainly address audio and streaming applications, Channel Sounding and Ambient IoT are the most relevant features for IoT applications.

Channel Sounding, introduced in Bluetooth 6.0, will expand Bluetooth from proximity detection to more accurate ranging and positioning. Key applications include automotive digital keys, home and building access control, “Find My” personal item finding, and small portable devices such as TWS charging cases, remote controllers, and HID devices. Adoption is expected to start from 2026, led by premium smartphones and higher-value IoT devices.

Current Bluetooth Channel Sounding is not designed for simultaneous tracking of many tags. Enterprise RTLS will therefore continue to rely on existing technologies such as Bluetooth AoA and UWB.

Ambient IoT and energy harvesting are another long-term growth area for Bluetooth. They target battery-less or ultra-low-power devices such as logistics smart labels, asset tracking tags, retail tags, and supply chain monitoring devices. Standardization is still at an early stage, and broad commercialization is likely around 2028 or later.

The Bluetooth-based logistics tag and smart label market has been expanding at scale since 2024-2025, especially in China and the U.S. Over the long term, Ambient IoT standardization could further accelerate market adoption.

BLE Single-Mode SoCs: Current Applications and Emerging Growth Markets

Long-term market growth drivers: The BLE single-mode SoC market is expected to expand over the long term, driven by migration from both dual-mode Bluetooth and proprietary RF, as well as the emergence of new use cases and applications enabled by new Bluetooth standards.

Since 2025-2026, remote control, HID devices, gaming peripherals, toys, lighting, smart home products, ESL, industrial terminals, POS devices, and SPI modules have increasingly shifted from legacy dual-mode solutions or proprietary RF to BLE single-mode SoCs. In addition, new standards and features, including Channel Sounding, Ambient IoT and PAwR, will expand applications in digital access, item finding, logistics and asset tracking, ESL, and smart home.

Current major applications: The current BLE single-mode SoC market is diversified, but four application groups each account for approximately 10-15% of IC shipments: healthcare devices, remote controllers, HID devices, and industrial/commercial tracking. Healthcare is expanding particularly rapidly in continuous glucose monitoring (CGM). Remote controllers remain a large-volume market for TVs, set-top boxes, smart home appliances, cameras, and other consumer/mobile devices. HID applications include mice, keyboards, digital pens, and related peripherals. Industrial and commercial tracking covers asset tags, logistics tags, beacons, and supply-chain monitoring devices.

Medium- to long-term growth areas:

Future growth will be led by the following applications:

1. CGM is expected to continue expanding. After the U.S. market, the connected CGM market is growing in China, Europe, and other regions.

2. Industrial and logistics tags are already being deployed at scale by Chinese e-commerce companies, while major retailers in Europe and North America have begun adoption. Ambient IoT standards could accelerate broader deployment.

3. Smart home applications should benefit from the spread of Matter in the Western market, with BLE used for provisioning.

4. Automotive and e-bike digital keys are expanding in China with Channel Sounding technology.

5. Find My tags will expand through the growing white-brand market, while Channel Sounding products should improve the user experience.

6. ESL will gradually migrate from proprietary RF to Bluetooth, although the transition will remain incremental because of the cost and installed-base advantages of existing proprietary systems.

BLE Single-Mode SoC Competitive Landscape: Market Share and Positioning

Market share overview: The BLE single-mode SoC market remains fragmented, with more than 50 suppliers, but Nordic Semiconductor maintains a clear lead, accounting for 21% of shipments and 36% of revenue. By shipment volume, other major suppliers include Telink, Silicon Labs, PHYPlus, Realtek, EM Microelectronic, and NXP. By revenue, Silicon Labs ranks second, followed by NXP, Texas Instruments, Telink, Renesas, Realtek, and EM Microelectronic. Chinese suppliers generally compete at lower ASPs: Telink, PHYPlus, OnMicro, and YiChip together represent 29% of shipments but only 9% of revenue.

Major Data Bluetooth IC Suppliers by Application

Major suppliers by application: Supplier positions vary significantly by application because software expertise and local customer requirements and relationships differ by market. In healthcare, EM Microelectronic, Silicon Labs, and Nordic are leading suppliers for continuous glucose monitoring (CGM), while Chinese IC vendors are expanding as the domestic CGM market grows. In automotive Bluetooth, NXP and Texas Instruments remain the established leaders. Telink, Goodix, and other Chinese suppliers are emerging in China as Chinese car OEMs aim to increase IC sourcing from local suppliers. Industrial RTLS is led by Nordic, Silicon Labs, Texas Instruments, and other global vendors. In high-volume tags for Chinese e-commerce, PHYPlus and OnMicro have strong positions, while Wiliot and InPlay are notable in supply-chain management and emerging ultra-low-power or battery-less tracking solutions.

Chinese BLE SoC suppliers are dominant in the local supply chain, including the Alibaba, Xiaomi, Baidu and Tencent ecosystems, as well as IoT devices and peripherals from Shenzhen/South-China ODM ecosystems. However, their global footprint remains largely limited because overseas markets often require broader software ecosystems, long design cycles, and specific support.

Edge AI in BLE SoCs: The Value Beyond Wireless Connectivity

Bluetooth+AI SoC Class and Use Case

Edge AI integration is becoming an important way for BLE SoC suppliers to differentiate products and increase value beyond wireless connectivity. Edge AI enables functions such as anomaly detection, predictive maintenance, activity recognition, and context-aware control in wearables, connected healthcare devices, industrial IoT, and smart home products.

From TinyML to DSP and NPU: Initial BLE edge AI implementations mainly use TinyML and KB-class models for simple sensor analytics. The market is now moving toward integrated DSPs and NPUs that support larger MB-class models, multi-sensor fusion, and more complex inference. Longer term, Bluetooth High Data Throughput (HDT) will enhance capacity and allow BLE SoCs to address voice/sound processing and, eventually, image and camera-based AI applications.

Supplier positioning: Nordic Semiconductor and Silicon Labs are leading the integration of AI capabilities into BLE SoCs, while a growing number of suppliers support TinyML for sensor-based AI applications. Nordic, Alif Semiconductor, Ambiq Micro, and Telink are also among the leading suppliers integrating DSPs and NPUs to enable more complex multimodal AI applications.

The post Bluetooth IC Market Shifts Toward IoT as Edge AI and Positioning Gain Ground appeared first on IoT Business News.