Acoustic Wave Filters: Are Older Players Being a Bit Too Slow in Developing Newer Technologies?

Equity Analyst, LightStream Research

Farha Sabri

Equity Analyst

Long-Short Analysis on Japan, Asia and the World

LightStream Research

LightStream conducts quantitatively rigorous and data-driven analysis with a focus on Japan and Asia.

We consistently cover the Tech, Consumer and Industrial sectors, and provide ECM and Events coverage more broadly.

We supplement traditional qualitative insights from company relationships with a robust quantitative foundation that examines as much historical data as is available.
We further refine the accuracy of our insights and calls through the use of alternative data to flesh out current trends, and through a valuation framework that emphasises non-superficial peer group selection and a proper attempt to understand the metrics and changes that have driven security valuations in the past.

Thematic (Sector/Industry)

<ul><li>5G technology is on the way, driven by the increasing number of connected devices and the need for high quality video and audio streaming.</li><li>The newest generation of mobile network technology will drive the radio frequency front end (RFFE) market which is expected to grow at a 10-year CAGR of 16%. The RF filter market, which is a key subsector, should show the fastest CAGR of 21% over the same period.</li><li>Even though 5G is set to be initially deployed sometime after 2019, we are in agreement with consensus and as such expect widespread deployment after 2020.</li><li>5G is increasing the need for complex RFFE modules, primarily RF filters. RF content per mobile device could exceed USD 38 (a 5x increase compared to current levels under 4G).</li><li>The RF filter market in question is likely to demonstrate massive growth in the years to come. Filters per smartphone will see more than a 2x increase from the 4G level of 49 filters per smartphone. We believe that the delay in 5G deployment works to the benefit of RF filter manufacturers as they gain more time in developing the increasingly complex devices that 5G demands.</li></ul>

5G technology is on the way, driven by the increasing number of connected devices and the need for high quality video and audio streaming.The newest generation of mobile network technology will drive the radio frequency front end (RFFE) market which is expected to grow at a 10-year CAGR of 16%. The RF filter market, which is a key subsector, should show the fastest CAGR of 21% over the same period.Even though 5G is set to be initially deployed sometime after 2019, we are in agreement with consensus and as such expect widespread deployment after 2020.5G is increasing the need for complex RFFE modules, primarily RF filters. RF content per mobile device could exceed USD 38 (a 5x increase compared to current levels under 4G).The RF filter market in question is likely to demonstrate massive growth in the years to come. Filters per smartphone will see more than a 2x increase from the 4G level of 49 filters per smartphone. We believe that the delay in 5G deployment works to the benefit of RF filter manufacturers as they gain more time in developing the increasingly complex devices that 5G demands.

The Impact of 5G on the RFFE Market: Strong Demand for Complex RF Filters