Global Digital to Analog Converters (DAC) Market Size (2023-2030)

The Global Digital to Analog Converters (DAC) Market was valued at USD 1.4 Billion and is projected to reach a market size of USD 2.1 Billion by the end of 2030. Over the forecast period of 2023-2030, the market is projected to grow at a CAGR of 5.2%.

The technology used in an average person’s everyday life is becoming extremely automation oriented, increasing the need for such devices. Furthermore, expectations of a user, pertaining to the quality of audio and visuals they hear, are also very high. Both of these factors help steer the market growth further and are the key drivers.

Industry Overview:

Digital to Analog converters or DACs are devices that perform the task of signal conversion. In their most basic form, they convert digital signals received by any device into interpretable analog signals for that device. In its actual form, DACs are just ICs or integrated circuits that perform a more specific task. Most of the digital to analog converters work with audio or video type of applications because they can be used together to better implement their original functionalities. On the opposite end of the spectrum are the Analog to Digital converters or ADCs. They are less error oriented but they don’t provide the functionalities that DACs provide like working with high frequencies.

COVID-19 impact on the Digital to Analog Converters (DAC) Market:

Hardly any industry remains which has been left unaffected by the pandemic that hit the planet in 2020. It swept with it the structures and base of several industries and globally flourishing markets. Besides the essential products and healthcare that were part of the personal protective equipment kits, almost all industries faced significant blows, and a majority of small businesses were left next to nothing. The manufacturing plants in several Asia-pacific countries faced a blow due to the COVID-19 restrictions and the guidelines that were set into place. Countries like China managed to keep their construction plants running and profited a lot from the business. The increasing demand for smartphones and smart TVs and other devices increased in lockdown which ensured that the DACs market did not completely shut down.

Market Drivers:

The need for automation in everyday technology and devices is a significant factor to drive the market growth for Digital to Analog Converters (DAC):

Automatic electronic devices or in some aspects also known as smart devices have taken over the electronics world by storm. The significance that devices like smart speakers, TVs, audible devices, phones, and more hold can be easily perceived by the surroundings. A 2022 data report claimed that over one hundred thirty (130) million homes owned a smart device, even if it was just a speaker. That is an extremely large number and it is said to be more than double in the upcoming half a decade. These numbers prove that automation is needed in everyday devices and the need for it is growing significantly. The audio and videos that are available through these devices are only possible through DACs. Thus it is foreseeable that the use of DACs and its market will only increase in the forecast period and that will drive the market.

Skyrocketing user expectations with respect to the quality of devices also aid in the growth of the DACs market:

The mobile and PC games that are launching more and more frequently are predicted to have better visuals and audio quality than their competitors alongside providing better quality than their previous versions. As aforementioned over 130 million homes are gearing towards becoming smart homes which comes with high expectations for better resolution screens pertaining to all devices. All of these are also part of the IOT domain which is set to reach a market size of $1.3 trillion which is no insignificant feat. The audio quality for the devices and their visuals are becoming sharper even surpassing the HD and 4K measures. DACs play a very significant role in helping the devices achieve this goal. Thus, as user expectations increase it is likely that the DAG market will also grow to keep up with the quality demands.

Market Restraints:

The Digital to Analog Converters (DAC) Market's growth is being stifled by the high costs of production:

The demand for quality is more now than ever. Most people don’t want to accept sub-par results for quality in what they pay their hard-earned money for. All devices that include DACs aim to use high-quality parts thus ensuring that the digital-to-analog converter used is also of high quality and tolerance. But quality comes with a great monetary price. The parts that are included in a DAC are extremely costly and the raw materials used are not cheap either. Besides that, the pandemic has caused several supply chain issues that have rendered over and are causing a shortage of resources. All of this adds up to make a good-quality DAC extremely expensive. Beyond that, they require manpower along with other forms of capital financial, like lands for production and distribution companies, etc. This makes it a very expensive product and that hampers the overall market growth.

Market Segments:

DIGITAL TO ANALOG CONVERTERS MARKET REPORT COVERAGE:

This research report on the global Digital to Analog Converters (DAC) Market has been segmented based on type, application, and region.

Digital to Analog Converters (DAC) Market- Segmentation by Type

• Hybrid
• R-2R
• Pulse-Width Modulator
• String
• Current Source and Sink
• Binary-Weighted
• Others

The R-2R type DAC uses the resistor network to work and produce signals that can be acceptable which are processed and later converted into analog form. The hybrid DACs are used as a combination of more than one type of aforementioned DACs and can be used as a better alternative that is also economically feasible because of its cheaper price. Therefore, the hybrid segment accounted for the highest market share of the total sales in 2022 and is anticipated to continue dominance during the forecast period as well.

Digital to Analog Converters (DAC) Market- Segmentation by Application

• Audio
• Video
• Mechanical
• Others

Digital to Analog converters are used in several latest technology devices to offer great audio and visual qualities which can be a combination ideal for the latest smart home devices. Therefore, they accounted for a maximum share of the market in 2022.  Along with that, those are the most common applications of digital to analog converters. The mechanical applications are not as frequent but they can be observed on an industrial level and Analog to Digital Converter or ADCs are more popular at that level.

Digital to Analog Converters (DAC) Market- Segmentation by Region

• North America
• Europe
• Asia-Pacific
• Rest of the World

The largest market for Digital to Analog Converters of DAC has been Europe for the longest time. It is followed by North America as a close second, especially in the United States and Canada. Both regions are well-versed and far-ahead in terms of technological advancements and are thus the reason for holding the largest market share.

Owing to China’s extremely forward telecommunication policies and increasing demands in countries like India, Asia-Pacific is said to be the top market position holder for the forecast period from 2022-2030 for Digital to Analog Converters (DAC). India and China are also predicted to invest large sums of money into further development of the automation-led electronics market, a lot of which requires DACs at high levels.

Major Key Players in the Market

1. Naim
2. TI
3. ADI
4. Maxim
5. Momoprice
6. Digi-Key
7. ClariPhy
8. Axiom
9. Benchmark
10. Aeroflex
11. GUC

Market Insights and Developments

• Launched in January 2022, The Chord Mojo 2 is claimed to be one of the best digital to analog converters and headphone amplifiers available in the market, for its features and its price range. Despite its absence of Bluetooth connectivity, it has several features that make it viable like providing some of the clearest sound and great quality.
• In March 2021, the iFi Zen DAC has come with version 2 which is a great alternative for desktop headphones and is very preferable for its multiple output options along with being lightweight and easily accessible.