Global Cellular IoT Modules Market Outlook, 2031

Global cellular IoT module shipments reached 544 million units in 2025 against a total IoT module market of 820 million units, with China alone contributing 43 percent of global module output at 350 million units, a concentration that reflects both the scale of Chinese manufacturing and the country's dominance in POS, asset tracking, and surveillance deployments. LTE Cat-1 bis has become the volume anchor of the entire category, accounting for almost half of all module shipments in the third quarter of 2025 and rising to 63 percent of total cellular IoT module shipments across the full year, a displacement of legacy Cat-4 and Cat-1 architectures that rests on single-antenna design, reduced bill-of-materials cost, and simplified system integration. Government policy has become the single most reliable demand lever, with China's Ministry of Industry and Information Technology issuing the all-things-intelligent-connection notice in 2025 to accelerate the transition from basic connectivity to intelligent IoT, and nine ministries jointly issuing a three-year action plan in March 2026 targeting a core IoT industry scale exceeding 3.5 trillion yuan with ten hundred-million-connection and fifteen ten-million-connection application domains. India's Revamped Distribution Sector Scheme has emerged as the largest single public procurement driver in the category, envisaging the installation of 250 million prepaid smart meters nationwide, a programme that propelled India's cellular IoT module shipments to 40 percent year-on-year growth in the third quarter of 2025 and 32 percent growth in the first quarter of the same year. 5G RedCap has moved from standardisation into early commercial deployment, with ABI Research forecasting 80 million cumulative RedCap module shipments between 2024 and 2029 and 71 percent of that volume expected to be eRedCap, while average RedCap module pricing is projected to fall from 18.2 dollars in 2024 to 11.6 dollars by 2026 as 23 chipset vendors released Release 17 and Release 18 compliant baseband solutions. The industry is shifting from connectivity hardware toward edge intelligence, with embedded AI cellular IoT modules accounting for 6 percent of shipments in the first quarter of 2026 and vendors repositioning around "communication plus compute plus AI" platforms that combine local processing, security, and device management rather than selling bare modems.

Quectel retained global leadership with 37 percent shipment share in the third quarter of 2025, supported by 243.26 billion yuan in 2025 revenue and a first-time majority of revenue generated outside China, while China Mobile held second place at 12 percent on operator-driven domestic demand and Sunsea AIoT ranked third at 8 percent. The top five vendors Quectel, China Mobile, Fibocom, Sunsea AIoT, and Telit Cinterion accounted for 73 percent of module shipments in the first quarter of 2025, and Chinese vendors occupied all five top positions in the full-year 2025 shipment ranking with a combined 69 percent share, a concentration that has accelerated rather than moderated through the inventory correction. Lierda emerged as the fastest-growing vendor at 73 percent annual growth, driven by Cat-1 bis shipments and expansion into South Korea and Southeast Asia, while Telit Cinterion consolidated its position as the leading non-Chinese international vendor and u-blox exited the cellular IoT module business entirely under geopolitical and margin pressure. Entry barriers have shifted from radio design to certification breadth and cash-flow resilience, with a single module variant requiring eight to twelve certifications for global deployment at a cost of 50,000 to 100,000 dollars and ten to sixteen weeks of cumulative testing, and regulatory teams consuming 5 to 10 percent of product development budgets. Pricing and transaction economics are compressing industry-wide, with average gross margins falling to 18.3 percent in 2025, down nearly five percentage points from 2021, domestic Chinese business margins at 10 to 20 percent against 20 to 30 percent internationally, and DRAM supply shortages pushing up bill-of-materials cost for 5G and smart modules. Investment and funding activity is concentrating around RedCap and AI-capable platforms, with only vendors holding sufficient liquidity able to sustain RedCap, AI product, and customer support spending while average selling prices decline, and chipset competition bifurcating between Qualcomm's dominance in 5G and high-end LTE against ASR, UNISOC, and Eigencomm strengthening in Cat-1 bis.

Market Dynamics Driver: Government-mandated smart metering and utility digitalisation
• Smart metering and energy management became the largest vertical application in 2025 at 170 million units, and the demand is structurally underwritten rather than commercially cyclical because India's RDSS programme alone targets 250 million prepaid meter replacements by 2027 while China's state grid and utility digitalisation programmes sustain the world's largest installed base.
• The transition from RF and power-line communication to cellular connectivity is accelerating because cellular modules eliminate the concentrator and repeater layers that RF mesh requires, and utilities in Europe are executing second-wave AMI rollouts that lifted European module shipments 11 percent in the third quarter of 2025 on automotive, router/CPE, and AMI demand.
• The economic logic reinforces policy intent because Cat-1 bis module costs have fallen below three dollars per unit in volume, making cellular connectivity cheaper than maintaining proprietary RF infrastructure for meter-to-cloud data paths in high-density urban and semi-urban distribution networks.

Challenge: Certification fragmentation and margin compression squeezing smaller vendors
• A single module variant destined for global deployment requires eight to twelve separate certifications at a cost of 50,000 to 100,000 dollars and ten to sixteen weeks of cumulative testing, and dedicated regulatory teams consume 5 to 10 percent of product development budgets, a burden that falls disproportionately on vendors without global scale.
• North America demands rigorous certification and is pushing toward 5G RedCap while other regions maintain legacy 2G, 3G, and LTE networks, creating what industry participants describe as a connectivity fragmentation crisis that forces separate hardware architectures for different geographies.
• Average selling prices are declining faster than cost reduction can offset, with gross margins compressed to 18.3 percent industry-wide and DRAM shortages raising 5G module bill-of-materials cost, leaving only vendors with strong liquidity able to sustain RedCap and AI investments without eroding profitability.

Trend: AI-enabled and RedCap modules moving from pilot to mainstream portfolio
• Embedded AI cellular IoT modules reached 6 percent of shipments in the first quarter of 2026, and vendors are repositioning from connectivity suppliers to edge intelligence platforms combining communication, computation, and AI inference for surveillance, automotive, industrial, and retail use cases.
• 5G RedCap is entering commercial deployment with modules launching in early 2026 and eRedCap devices expected in 2027, and GSA expects RedCap to dominate the mid-tier 5G IoT space for several years by bridging LTE and full 5G before eRedCap achieves broader adoption.
• The RedCap price trajectory is the decisive variable for replacement volume, with module average selling prices falling from 18.2 dollars in 2024 to an estimated 11.6 dollars by 2026, and meaningful displacement of legacy Cat-4 and Cat-6 volumes expected only when pricing approaches LTE levels and 5G standalone coverage becomes widespread.



Segment Analysis By Cellular Technology
• Legacy 2G and 3G modules retain a shrinking installed base in point-of-sale terminals, utility meters, and asset trackers across markets where network sunsets have not completed, and the segment's strategic importance now lies in replacement migration rather than new design wins as operators refarm spectrum for LTE and 5G.
• NB-IoT remains the reference technology for low-power wide-area metering and municipal infrastructure, with 74 countries and regions having allocated dedicated or shared spectrum by the end of 2025, the European Commission designating 703 to 733 MHz and 863 to 870 MHz as priority bands, and India opening 865 to 867 MHz for licence-exempt use in January 2026.
• LTE-M occupies a narrower but durable niche in wearables, medical devices, and mobile asset trackers where handover and voice capability matter, and the technology is increasingly positioned as a complement to NB-IoT within multi-mode modules rather than a stand-alone volume driver.
• Cat-1 bis is the single most consequential technology in the market, accounting for almost half of all shipments in the third quarter of 2025 and 63 percent across the full year, and its single-antenna, cost-optimised architecture has made it the default choice for smart meters, POS terminals, trackers, and routers/CPE across China, India, and emerging markets.
• Broadband LTE modules serve routers, CPE, and automotive telematics where throughput requirements exceed Cat-1 bis capability, and the segment is being squeezed from below by Cat-1 bis in price-sensitive applications and from above by 5G modules in performance-driven deployments.
• 5G modules grew at nearly three times the industry average in 2025 and became the fastest-growing cellular technology at 39 percent year-on-year growth in the first quarter of 2026, while RedCap modules launched commercially in early 2026 with cumulative shipments forecast at 80 million units between 2024 and 2029 and 71 percent of that volume expected to be eRedCap.

By Module Form Factor
• Surface-mount LGA and BGA packages are projected to dominate the market with 68.14 percent share in 2026 because they suit high-volume automated manufacturing of meters, trackers, and POS terminals where solder-down reliability and cost per unit outweigh field-replaceability.
• M.2 modules serve routers, gateways, and industrial PCs where a plug-in card format simplifies integration and field replacement, and the form factor is favoured in router/CPE applications that drove European and MEA module growth in 2025.
• Mini PCIe retains a legacy role in industrial gateways, fleet telematics, and older router platforms where the host board was designed around the PCIe mini card interface, and new design activity has largely migrated to M.2 and LGA formats.
• System-in-package and SiP modules integrate baseband, RF front-end, memory, and power management into a single package, and the format is gaining traction in wearables and space-constrained trackers where discrete component placement would exceed the device envelope.
• USB dongles, LCC packages, and board-to-board connectors constitute the remaining form-factor demand, concentrated in aftermarket telematics, industrial retrofits, and development kits rather than high-volume OEM production.

By Application
• Smart metering became the largest application in 2025 at 170 million units, driven by India's 250-million-meter RDSS programme, China's state grid digitalisation, and European second-wave AMI rollouts, and the application is the most policy-insulated demand pool in the entire module market.
• Asset tracking is a core volume application for Cat-1 bis and LTE-M modules, and the application is expanding from simple location reporting toward combined tracking and telematics with local processing, driving demand for modules with integrated GNSS and edge compute.
• Industrial IoT deployments span predictive maintenance, remote monitoring, and industrial gateways, and the segment favours modules with extended temperature range, industrial certification, and long lifecycle support rather than the lowest-cost Cat-1 bis variants used in consumer meters.
• POS terminals are a major demand driver in China, where domestic demand for POS, asset-tracking, and surveillance applications sustained 7 percent shipment growth, and the application requires secure element integration and PCI-compliant module designs that raise certification complexity.
• Healthcare and wearable applications use LTE-M and RedCap modules where continuous connectivity, handover, and compact form factor matter, and the segment is a key early market for RedCap because eRedCap's reduced complexity and cost align with wearable device economics.
• Smart cities span street lighting, parking, environmental monitoring, and utility infrastructure, and the application is policy-driven with municipal procurement cycles that favour NB-IoT for low-data sensors and Cat-1 bis for higher-bandwidth camera and controller connectivity.
• Automotive telematics, routers/CPE, and security cameras constitute the remaining demand, with automotive module penetration exceeding 45 percent and routers/CPE emerging as a primary growth driver in Europe and the Middle East and Africa.

Regional Analysis • North America grew 4 percent in the third quarter of 2025, reflecting more measured enterprise spending, and the region's demand profile is shaped by rigorous certification requirements, a push toward 5G RedCap, and the exit of u-blox from the cellular module business, which has shifted procurement toward vendors with demonstrated compliance and supply-chain transparency.
• Europe recorded 11 percent shipment growth in the third quarter of 2025, supported by automotive, router/CPE, and second-wave AMI rollouts, and the European Commission's July 2025 IoT spectrum roadmap designating 703 to 733 MHz and 863 to 870 MHz as NB-IoT priority bands provides a regulatory foundation for utility and municipal deployments across member states.
• Asia-Pacific is the centre of gravity for both supply and demand, with China contributing 43 percent of global module output at 350 million units and 7 percent shipment growth in the third quarter of 2025, India delivering 40 percent growth on RDSS smart metering, and China's MIIT action plan targeting 3.5 trillion yuan in core IoT industry scale by 2028.
• South America's cellular IoT module demand is concentrated in Brazil, which accounted for 59.31 percent of South American 5G device volumes in 2025, and regional growth is driven by telematics, smart meters, and utility modernisation, with Brazil's IoT market valued at 18.41 billion dollars in 2024 and projected to reach 99.34 billion dollars by 2033.
• The Middle East and Africa delivered the second-fastest regional expansion in the third quarter of 2025 from a smaller base, generating 0.3 billion dollars in module revenue at 6.57 percent of the global market, and growth is supported by national utility modernisation programmes and rising router/CPE demand rather than industrial automation or automotive telematics.


Considered in this report
• Historic Year: 2020
• Base year: 2025
• Estimated year: 2026
• Forecast year: 2031

Aspects covered in this report
• Cellular IoT Modules Market with its value and forecast along with its segments
• Various drivers and challenges
• On-going trends and developments
• Top profiled companies
• Strategic recommendation

By Cellular Technology
• 2G and 3G Modules
• NB-IoT Modules
• LTE-M Modules
• LTE Cat 1 and Cat 1bis Modules
• Broadband LTE Modules
• 5G NR and RedCap Modules

By Module Form Factor
• LGA and Surface-Mount Modules
• M.2 Modules
• Mini PCIe Modules
• System-in-Package Modules
• Other Form Factors

By Application
• Smart Metering
• Asset Tracking and Fleet Management
• Industrial IoT
• Point-of-Sale and Payment Terminals
• Healthcare and Wearable Devices
• Smart Cities and Infrastructure
• Other Applications